Judgment Background of the case: The petitioner is a dealer in sand. It has obtained Mineral Dealer Licence on 1-8-2007 from respondent No.2 for a period of five years. The petitioner pleaded that it has purchased land in Sy.No.45 of Bhikanelly village, Khandgoan Gram Panchayat, Bodhan, Nizamabad District, for storing/trading and selling/processing of sand. On the eve of expiry of the licence, the petitioner applied for renewal. Vide his letter dated 15-7-2012, respondent No.2 has renewed the licence from 31-7-2012 to 30-6-2017 under Rule 4 of the A.P. Mineral Dealers’ Rules, 2000 (for short “the 2000 Rules”). By order dated 25-7-2012, respondent No.2 has cancelled the petitioner’s licence on the ground that it has not submitted monthly and quarterly reports from the time of grant of the Mineral Dealer Licence. The petitioner has questioned the said order in W.P.No.23631/2012. By order dated 3-8-2012, this Court allowed the said Writ Petition on the short ground that no notice was issued to the petitioner before cancelling the licence and that therefore the same was in violation of Rule 7(vi). Accordingly, this Court has directed that the cancellation proceedings dated 25-7-2012 be treated as show-cause-notice and the petitioner was permitted to give explanation within 15 days with the direction to respondent No.2 to take appropriate decision thereon. The petitioner thereafter submitted its explanation and on verification of the same, respondent No.2 has dropped further action vide his proceedings dated 10-10-2012. 2. Respondent No.2 has issued a fresh show-cause-notice on 29-11-2012 calling upon the petitioner to show cause why the licence granted to it shall not be cancelled as the Government has issued a new sand policy by amending the rules as per which a licence can be granted for processing/storing/stocking/selling/trading ordinary sand to any person/firm/society/company who is an allottee in terms of A.P. Minor Mineral Concession Rules, 1966 (for short “the 1966 Rules”). The said show-cause-notice was served on the petitioner on 10-12-2012. Within four days of service of the said notice, respondent No.2 cancelled the petitioner’s licence by order dated 14-12-2012. Assailing the said order, the petitioner filed W.P.No.39507/2012. By order dated 28-1-2013, this Court allowed the said Writ Petition on the ground that though the petitioner had time till 24-12-2012 for submitting its explanation to the show-cause-notice, the order cancelling the licence was passed on 14-12-2012. Assailing the said order, the petitioner filed W.P.No.39507/2012. By order dated 28-1-2013, this Court allowed the said Writ Petition on the ground that though the petitioner had time till 24-12-2012 for submitting its explanation to the show-cause-notice, the order cancelling the licence was passed on 14-12-2012. Accordingly, the said was set-aside leaving it open to respondent No.2 to pass a fresh order after taking into account the explanation submitted by the petitioner on 5-1-2013. Purporting to consider the petitioner’s explanation, respondent No.2 has passed order vide proceedings No.716/MDR/DDNZB/2012, dated 1-2-2013 cancelling the petitioner’s licence. It is this order which is called in question in this Writ Petition. 3. Respondents’ stand: In response to the notice issued in the Writ Petition, respondent No.3 filed a counter affidavit. The core of the counter affidavit reflecting the stand of the respondents is contained in paras 8, 9 and 10 thereof. It would be useful to reproduce these paras hereunder : “In reply to the averments made in paragraph 7 & 8 of the affidavit, it is respectfully submitted that the Government vide G.O.Ms.No.154, Ind. & Com. Dept., Dt. 15.11.2012 has amended Andhra Pradesh Minor Mineral Rules, 1966. As per Rule 9K(3) “No Dealer Licence shall be granted for Processing/Storing/Stocking/selling/trading etc of ordinary sand to any person/firm/society/company who is not an Allottee in terms of amended APMMC Rules 1966. Further, as per Rule 9-L the procedure for de-casting sand from patta lands abutting the river beds has been prescribed and Mineral Dealer Licence shall be issued to the pattadar for disposal of sand extracted from patta lands. In the instant case, the extraction of sand is from the state of Maharashtra whereas the Mineral Dealer Licence has been issued as per APMD Rules, 2000 which is contrary to the amended APMMC Rules, 1966. As the matter stood thus, the Director of Mines and Geology, Hyderabad vide Memo No.49098/R8-1/Sand/2012, Dt: 26.11.2012 has directed the 3rd respondent to take necessary action immediately for cancellation of Mineral Dealer Licence held by M/s. Appi Reddi & Company, Prop. Sri M. Appi Reddy in the subject area duly following the procedure under law in view of the new sand policy and amended APMMC Rules 1966. Accordingly, Dy. Sri M. Appi Reddy in the subject area duly following the procedure under law in view of the new sand policy and amended APMMC Rules 1966. Accordingly, Dy. Director of Mines and Geology, Nizamabad has issued a show-cause-notice to M/s. Appi Reddy and Company, Vide No.716/MDR/DDNZB/2012 Dt: 29.11.2012 and requested to show cause within 15 days from the date of receipt of this notice as to why the Mineral Dealer Licence held by him in the subject area should not be cancelled as per the new sand policy and amended APMMC Rules, 1966. Further, M/s. Appi Reddy & Company, Prop. Sri M. Appi Reddy has acknowledged receipt of the show cause notice on 10.12.2012, but no reply has been received from their end, accordingly, Dy. Director of Mines and Geology, Nizamabad has issued cancellation orders vide proceeding No.716/MDR/DDNZB/2012, dt: 14.12.2012 as per the new sand policy and the amended Andhra Pradesh Minor Mineral Rules, 1966. Therefore, the contention of the petitioner is false and baseless. Hence, the writ may be dismissed in lemine”. In reply to the averments made in paragraph 9 to 12 of the affidavit, it is respectfully submitted that M/s. Appi Reddy, Prop. Sri M. Appi Reddy have filed a Writ Petition No.39507 of 2012 before the Hon’ble High Court of Andhra Pradesh, Hyderabad. The Hon’ble High Court of Andhra Pradesh had issued orders on 31-12-2012 that “In the meanwhile, it shall be open to the petitioner to submit explanation to the show cause notice dated 29.11.2012 within one (01) week from today. The 3rd respondent shall take the same into account and pass fresh orders, notwithstanding the pendency of this writ petition. To pave the way for that, the order dated 14-12-2012 is kept in abeyance. The petitioner shall be entitled to sell the sand, which is already stored by it, but it shall not bring fresh stocks during this period”. Accordingly, M/s. Appi Reddy & Company, Prop. Sri M. Appi Reddy have submitted explanation to the show cause notice dated : 29.11.2012 as per orders of the Hon’ble High Court of Andhra Pradesh in writ petition No.39507 of 2012 and requested to re-call the cancellation orders issued by Dy. Director of Mines and Geology, Nizamabad, dated 14.12.2012. Accordingly, M/s. Appi Reddy & Company, Prop. Sri M. Appi Reddy have submitted explanation to the show cause notice dated : 29.11.2012 as per orders of the Hon’ble High Court of Andhra Pradesh in writ petition No.39507 of 2012 and requested to re-call the cancellation orders issued by Dy. Director of Mines and Geology, Nizamabad, dated 14.12.2012. Further, the Hon’ble High Court of Andhra Pradesh, Hyderabad while disposing the writ petition No.39507 of 2012 vide issued orders on 28.01.2013 stating that “the writ petition is allowed and the impugned order is set-aside. It is left open to the 3rd respondent i.e., Dy. Director of Mines and Geology, Nizamabad to pass fresh orders taking into account the explanation submitted by the petitioner on 05.01.2013”. The explanation submitted by M/s. Appi Reddy & Company, Prop. Sri M. Appi Reddy has been examined and found that it cannot be considered and it is contrary to Rules 9-K(3) of new sand policy and amended Rules 9-B to 9-Z of APMMC Rules, 1966. Rule 9-K(3) of amended APMMC Rules 1966 speaks that “No dealer Licence shall be granted for processing/storing/stocking/selling/trading etc., of ordinary sand to any person/firm/society/company who is not an Allottee in terms of these rules”. Submissions of the counsel: 4. At the hearing, Sri Srinivasa Rao Bodduluri, learned Counsel for the petitioner, made the following submissions: (1) That the petitioner was granted licence under the 2000 Rules framed under Section 23(c) of the Mines and Minerals (Development and Regulation) Act, 1957 (for short “the Act”) while the 1966 Rules were framed under Section 15 of the Act; that these two set of Rules operate in different fields to achieve different purposes and that the right accrued under the 2000 Rules cannot be taken away by the 1966 Rules. (2) That amendments were brought out to the 1996 Rules following the Judgment of the Apex Court in Deepak Kumar Vs. State of Haryana ( (2012) 4 SCC 629 ) with a view to further regulate excavation of sand, trading and transportation of such sand in the State of Andhra Pradesh and that those amendments have no application to and do not affect the licences granted to the dealers under the 2000 Rules. State of Haryana ( (2012) 4 SCC 629 ) with a view to further regulate excavation of sand, trading and transportation of such sand in the State of Andhra Pradesh and that those amendments have no application to and do not affect the licences granted to the dealers under the 2000 Rules. (3) That Rule 9-P of the 1966 Rules bans only transportation of sand from the State of Andhra Pradesh and that as the petitioner is neither excavating sand nor transporting the same from the State of Andhra Pradesh for the purpose of trading, the amendments made to the 1966 Rules have no effect on the licence granted to the petitioner. 5. The learned Government Pleader for Mines and Geology opposed the above submissions and reiterated the contents of the counter affidavit in order to justify the impugned order of cancellation of the petitioner’s licence. 6. POINT: Based on the respective pleadings of the parties, the Point that arises for consideration is whether the 1966 Rules as amended w.e.f., 15-11-2012, have any effect on the Mineral Dealer Licence granted to the petitioner and the same is liable or cancellation. 7. Legal environment: Entry 54 of List-I of the VII Schedule to the Constitution of India empowers the Union of India to regulate mines and mineral development by enactment of law by the Parliament. Entry 23 of List-II also governs the regulation of mines and mineral development, subject to the provisions of List-I in respect of regulation and development under the control of the Union. With a view to provide for regulation and development of mines and minerals, the Parliament enacted the Act in the year 1957. Section 2 of the Act declared that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals to the extent provided under the Act. Section 3(a) defined ‘Minerals’ as including all minerals except mineral oils. Section 4 prohibits reconnaissance, prospecting or mining operations in any area, except under and in accordance with the permit, license or the lease as the case may be granted under the Act and the Rules made thereunder. Section 5 envisages restrictions on the grant of licences, leases and permits. Section 3(a) defined ‘Minerals’ as including all minerals except mineral oils. Section 4 prohibits reconnaissance, prospecting or mining operations in any area, except under and in accordance with the permit, license or the lease as the case may be granted under the Act and the Rules made thereunder. Section 5 envisages restrictions on the grant of licences, leases and permits. Section 9 provides for payment of royalty in respect of any mineral removed or consumed by the holder of a mining lease to the Agent, Manager, Employee, Contractor or sub-lessee from the leased area at the rates as specified in the Second Schedule. Under Section 9 (a), the holder of a mining lease shall pay to the State Government every year dead rent at the rates as prescribed in the Third Schedule. Under Section 13, the Central Government is empowered to make rules for regulating the grant of reconnaissance permits, prospecting licences and mining leases. 8. Though the subject of mines and mineral development is included in the concurrent List also, the entire regulation of mining activity has been taken over by the Union of India as can be seen from the declaration contained in Section 2 of the Act (Section 2 : It is hereby declared that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals to the extent hereinafter provided.), thereby denuding the State Governments of the power to make law governing the areas which are governed by the Act. Section 15 (Section 15: Power of State Government to make rules in respect of minor minerals: (1) The State Government may, by notification in the Official Gazette, make rules for regulating the grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals and for purposes connected therewith. Section 15 (Section 15: Power of State Government to make rules in respect of minor minerals: (1) The State Government may, by notification in the Official Gazette, make rules for regulating the grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals and for purposes connected therewith. (1-A) In particular and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:- (a) the person by whom and the manner in which, applications for quarry leases, mining leases or other mineral concessions may be made and the fees to be paid therefor; (b) the time within which, and the form in which, acknowledgement of the receipt of any such applications may be sent; (c) the matters which may be considered where applications in respect of the same land are received within the same day; (d) the terms on which, and the conditions subject to which and the authority by which quarry leases, mining leases or other mineral concessions may be granted or renewed; (e) the procedure for obtaining quarry leases, mining leases or other mineral concessions; (f) the facilities to be afforded by holders of quarry leases, mining leases or other mineral concessions to persons deputed by the government for the purpose of undertaking research or training in matters relating to mining operations; (g) the fixing and collection of rent, royalty, fees, dead rent, fines or other charges and the time within which and the manner in which these shall be payable; (h) the manner in which rights of third parties may be protected (whether by way of payment of compensation or otherwise) in cases where any such party is prejudicially affected by reason of any prospecting or mining operations; (i) the manner in which rehabilitation of flora and other vegetation such as trees, shrubs and the like destroyed by reason of any quarrying or mining operations shall be made in the same area or in any other area selected by the State Government (whether by way of reimbursement of the cost of rehabilitation or otherwise) by the person holding the quarrying or mining lease; (j) the manner in which the conditions subject to which, a quarry lease, mining lease or other mineral concession may be transferred; (k) the construction, maintenance and use of roads, power transmission lines, mining, tramways, railways, aerial ropeways, pipelines and the making of passage for water for mining purposes on any land comprised in a quarry or mining lease or other mineral concession; (l) the form of registers to be maintained under this Act; (m) the reports and statements to be submitted by holders of quarry or mining leases or other mineral concessions and the authority to which such reports and statements shall be submitted. (n) the period within which and the manner in which and the authority to which applications for revision of any order passed by any authority under these rules may be made, the fees to be paid therefore, and the powers of the revisional authority; and (o) any other matter which is to be, or may be, prescribed. (2) Until rules are made under sub-section (1), any rules made by a State Government regulating the grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals which are in force immediately before the commencement of this Act shall continue in force. (3) The holder of a mining lease or any other mineral concession granted under any rule made under sub-section (1) shall pay royalty or dead rent whichever is more in respect of minor minerals removed or consumed by him or by his agent, manager, employee, contractor or sub-lessee at the rate prescribed for the time being in the rules framed by the State Government in respect of minor minerals: Provided that the State Government shall not enhance the rate of royalty for dead rent in respect of any minor mineral for more than once during any period of three years.) of the Act however empowers the State Governments to make Rules for regulation of grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals and for purposes connected therewith. The Rules so made inter alia may relate to matters such as fixing and collection of rents, royalty, fees, dead rent, fines or other charges and the procedure for obtaining quarry leases, mining leases or other mineral concessions. In exercise of this Rule making power, the Government of Andhra Pradesh has framed the 1966 Rules which were brought into force w.e.f., 7-12-1967. 9. In consonance with the purposes for which the rule making power is conferred on the State Government by the provisions of Section 15 of the Act, the 1966 Rules made provisions for grant of mining leases, collection of royalties, seigniorage fees/dead rent in respect of the minor minerals and regulating the activity of mining. The ambit of these rules has been thus confined to regulating the mining and other activities connected therewith. The 1966 Rules, as they were originally conceived, envisaged the method of tender/public auction for grant of leases of minor minerals, including, sand. The ambit of these rules has been thus confined to regulating the mining and other activities connected therewith. The 1966 Rules, as they were originally conceived, envisaged the method of tender/public auction for grant of leases of minor minerals, including, sand. As indiscriminate mining of sand all over the country was posing serious threat to environment, in Deepak Kumar (1-supra), the Supreme Court has shown serious concerns, so has a Division Bench of this Court which entertained a Public Interest Litigation and banned sand mining in the State of Andhra Pradesh. In Deepak Kumar (1-supra), the Supreme Court has taken into consideration the recommendations of the Ministry of Environment and Forests (MoEF) based on the report of a core group constituted by it under the Chairmanship of the Secretary (Environment and Forests). It has also taken note of D.O. letter dated 1-6-2010 addressed by the Minister for Environment and Forests to all the Chief Ministers of the States to examine the report and to issue necessary instructions for incorporating the recommendations made in the report in the Mineral Concession Rules for mining of minor minerals under Section 15 of the Act. With regard to quarrying of river sand, the Supreme Court in paras 25 and 26 (25.Quarrying of river sand, it is true, is an important economic activity in the country with river sand forming a crucial raw material for the infrastructural development and for the construction industry but excessive instream sand and gravel mining causes the degradation of rivers. Instream mining lowers the stream bottom of rivers which may lead to bank erosion. Depletion of sand in the streambed and along coastal areas causes the deepening of rivers which may result in destruction of aquatic and riparian habitats as well. Extraction of alluvial material as already mentioned from within or near a streambed has a direct impact on the stream’s physical habitat characteristics. 26. We are of the considered view that it is highly necessary to have an effective framework of mining plan which will take care of all environmental issues and also evolve a long-term rational and sustainable use of natural resource base and also the bio-assessment protocol. 26. We are of the considered view that it is highly necessary to have an effective framework of mining plan which will take care of all environmental issues and also evolve a long-term rational and sustainable use of natural resource base and also the bio-assessment protocol. Sand mining, it may be noted, may have an adverse effect on biodiversity as loss of habitat caused by sand mining will affect various species, flora and fauna and it may also destablise the soil structure of river banks and often leaves isolated islands. We find that, taking note of those technical, scientific and environmental matters, MoEF, Government of India, issued various recommendations in March 2010 followed by the Model Rules, 2010 framed by the Ministry of Mines which have to be given effect to, inculcating the spirit of Article 48-A and Article 51-A(g) read with Article 21 of the Constitution.) directed that the recommendations made by the MoEF, Government of India, in March 2010, on various technical, scientific and environmental matters, followed by the Model Rules of 2010 framed by the Ministry of Mines, shall be given effect to. 10. It is in this background that the State Government has amended the provisions of the 1966 Rules and notified the same in G.O.Ms.No.154, Industries & Commerce (Mines-1) Department, dated 15-11-2012, and published in the Extraordinary Issue of the A.P. Gazette dated 15-11-2012. These rules amended Rules 9-B to 9-Z of the 1966 Rules. The said rules have divested the mines Department of the power to grant sand leases and entrusted the power of regulation of the activity of extraction/disposal of sand in streams and rivers in the areas other than falling in the Scheduled Areas to the Mondal/Division/District authorities notified under the A.P. Water, Land and Trees Act, 2002 (for short “the WALTA Act”) and the Rules framed thereunder. Since this case is not concerned with the Scheduled Areas, it is not necessary to deal with the rule regulating sand disposals in the said Areas. 11. Rule 9-C of the amended Rules banned sand extraction from over-exploited notified areas except for local house use in villages or towns bordering the streams for bonafide purposes other than commercial operations/public trading/stocking etc. A multi-member Committee was constituted for proper enforcement of extraction and transportation of sand upto III order streams. 11. Rule 9-C of the amended Rules banned sand extraction from over-exploited notified areas except for local house use in villages or towns bordering the streams for bonafide purposes other than commercial operations/public trading/stocking etc. A multi-member Committee was constituted for proper enforcement of extraction and transportation of sand upto III order streams. Rule 9-D provided for elaborate procedure for identification of sand bearing areas in IV, V and above order streams. The amended Rules have done away with the tender/auction system for grant of sand leases. Instead, Rule 9-E envisaged allotment of sand quarries by drawl of lots in accordance with the procedure laid down therein. Under Rule 9-I, the sand extracted from IV order stream shall be utilised within the District and the sand extracted from V order and above streams shall be utilised within the State. Rule 9-K deals with establishment of a stockyard by the allottee. Under this Rule, the allottee shall establish a stockyard nearer to the bank of stream/river with accessibility for transportation for stocking the sand extracted from the specified sand bearing area after obtaining Mineral Dealer Licence as per the 2000 Rules. The allottee shall dispatch the sand from the stock yard after obtaining transit permits in Form-E from the authority competent under the 2000 Rules. Sub-Rule (3) of Rule 9-K, which is the cynosure for the present case, prohibits grant of dealer licence for processing/storing/stocking/selling/trading etc., of ordinary sand to any person/firm/society/company who is not an allottee in terms of the 2000 Rules. Rule 9-L permits decasting of sand from patta lands. Under this Rule, the sand extracted from patta lands shall be disposed of after obtaining licence under the Act. Rule 9-P bans transportation of sand from the State across the border to other States. 12. The 2000 Rules: Under Section 15 of the Act, as referred to supra, the rule making power conferred on the State Governments was confined only to regulating the grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals and for purposes connected therewith. The said provision did not vest any power in the State Governments to regulate transportation and storage of minerals. 13. In State of Tamil Nadu Vs. The said provision did not vest any power in the State Governments to regulate transportation and storage of minerals. 13. In State of Tamil Nadu Vs. M.P.P. Kavery Chetty ( AIR 1995 S.C. 858 ), the Supreme Court declared Rule 8-D and Rule 19-B introduced by the Tamil Nadu State in the Tamil Nadu Mineral Concession Rules, 1959 empowering itself or its officers or a State Government company or a Corporation to control the sale or quarried granite or other rock suitable for ornamental or decorative purposes and also to fix minimum price for sale thereof, ultra vires. In para-24 of the Judgment, the Supreme Court held that the power of the State Government as the subordinate rule making authority is restricted in the manner set out in Section 15 of the Act and no power is conferred upon the State Government under the Act to exercise control over the minor minerals after they have been excavated. 14. A Division Bench of this Court in Ranjana Granites Pvt. Ltd. Vs. State of Andhra Pradesh ( 1996 (3) ALT 121 (D.B.) has followed the dicta laid down by the Supreme Court in State of Tamil Nadu (5-supra) and struck down Rules 12(5)(e), 12(5)(f)(i) and 12(5)(f)(ii) of the 1966 Rules whereby double seigniorage fee for export of black granite and colour granite was imposed, as, such control or interference over the trade of the mineral after its extraction was not provided for in the Act. 15. Evidently, to rectify this lacuna existing in the Act, the Parliament introduced Section 23C (Section 23-C: (1) The State Government may, by notification in the Official Gazette, make rules for preventing illegal mining, transportation and storage of minerals and for the purposes connected therewith. (2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:- (a) establishment of check-posts for checking of minerals under transit; (b) establishment of weigh-bridges to measure the quantity of mineral being transported; (c) regulation of mineral being transported from the area granted under a prospecting licence or a mining lease or a quarrying licence or a permit, in whatever name the permission to excavate minerals, has been given. (d) inspection, checking and search of minerals at the place of excavation or storage or during transit; (e) maintenance of registers and forms for the purposes of these rules; (f) the period within which and the authority to which applications for revision of any order passed by any authority be preferred under any rule made under this section and the fees to be paid therefor and powers of such authority for disposing of such applications; and (g) any other matter which is required to be, or may be, prescribed for the purpose of prevention of illegal mining, transportation and storage of minerals. (3) Notwithstanding anything contained in section 30, the Central Government shall have no power to revise any order passed by a State Government or any of its authorised officers or any authority under the rules made under sub-sections (1) and (2)) by Amending Act 38/1999 w.e.f., 20-12-1999. As could be seen from the heading of this provision, the State Governments are empowered to make rules for preventing illegal mining, transportation and storage of minerals. Regulation of transportation of mineral for which the State Government is empowered to make rules under sub-clause (c) of Section 23-C, is in respect of the mineral transported from the area granted under a prospecting licence or a mining lease or a quarry licence or a permit to excavate minerals. Sub-clause (g) of Section 23-C empowers the State Government to make rules for prevention of illegal mining, transportation and storage of minerals. 16. In exercise of the rule making power under Section 23-C of the Act, the State Government framed the 2000 Rules. Rule 2(1)(d) thereof defined “Dealer” (Rule 2(1)(d): “Dealer” means any person who carries on the business of buying, selling, supplying, transporting, distributing or delivering for sale of minerals and mineral products and includes: (a) Person who buy and process mineral or mineral products for sale or for utilization for their own purposes. (b) Any person who holds a mining lease or a quarry lease granted under the Mineral Concession Rules, 1960 or the A.P. Minor Mineral Concession Rules, 1966 (issued by the Government, framed under the Mines and Minerals (Development and Regulation) Act, 1957.) Sub-clause (h) thereof defined “mineral” which includes all types of varieties of minerals. (b) Any person who holds a mining lease or a quarry lease granted under the Mineral Concession Rules, 1960 or the A.P. Minor Mineral Concession Rules, 1966 (issued by the Government, framed under the Mines and Minerals (Development and Regulation) Act, 1957.) Sub-clause (h) thereof defined “mineral” which includes all types of varieties of minerals. Rule 3 (Rule 3: (1) All dealers shall register themselves as dealers with the Mines and Geology Dept of the Government of Andhra Pradesh as per the procedure indicated in the following Rules. (2) No person other than a dealer or a mining lease holder shall buy or sell or offer for sale or engage in any transaction of buying and selling any mineral at any place or transport mineral for purposes of sale or consumption without being registered as a dealer. Provided that no person purchasing and transporting minerals for use or consumption by himself, (where such user or consumption does not involve any commercial activity) and any holder of a mining lease or a quarry lease in respect of the mineral for which he holds a lease, shall be required to register himself as dealer.) which was substituted by an amendment by G.O.Ms.No.330, Industries & Commerce (M-1) Department, dated 14-6-2001, envisages registration of dealers with the Mines and Geology Department of the Government of Andhra Pradesh, as per the procedure indicated in the Rules and following Rule 3. Sub-Rule (2) prohibits buying or selling or offering for sale or engaging in any transaction of buying or selling or transporting mineral for the purposes of sale or consumption by any person other than a dealer or a mining lease holder. Under the proviso, a person who does not involve in any commercial activity or holding a mining lease or a quarry lease is not required to register himself as a dealer. Rule 4 provides for granting of registration and its renewal. The Rules relating to seizure and confiscation and imposition of penalty etc., are not relevant for the present purpose. Under the proviso, a person who does not involve in any commercial activity or holding a mining lease or a quarry lease is not required to register himself as a dealer. Rule 4 provides for granting of registration and its renewal. The Rules relating to seizure and confiscation and imposition of penalty etc., are not relevant for the present purpose. However, the long title of the Rules (In exercise of the powers conferred by Section 23 (c) of the Mines and Minerals (Development and Regulation) Act, 1957 (Act 67 of 1957), the Governor of Andhra Pradesh hereby makes the following rules to regulate the possession, storage, trading and transport of minerals and mineral products and to check the evasion of royalty or seigniorage fee, stopping of illegal mining and quarrying and transportation in the State of Andhra Pradesh and for the purposes connected therewith.) is relevant for the present purpose, a reading of which would disclose that the said Rules have been made to regulate possession, storage, trading and transport of minerals and mineral products and to check the evasion of royalty or seigniorage fee, stopping of illegal mining and quarrying and transportation in the State of Andhra Pradesh and the purposes connected therewith. 17. Analysis: The 1966 Rules dealing with regulation of grant of mining/quarry licences/permits/allotments laid down conditions for exploitation/excavation of minor mineral including prohibition of quarrying/mining in certain notified areas, payment of royalty, seigniorage fee, dead rent etc. The amplitude of these Rules primarily ends with extraction/excavation of the mineral. The newly inserted Rules in the 1966 Rules, however, place restrictions on transportation of sand as well and also prohibition on inter-state transportation of sand extracted in the State of Andhra Pradesh. But it needs to be noted that such restriction is confined to sand extracted from the streams/rivers in the State of Andhra Pradesh. The substituted rules also regulate the stockyards under a licence, to be taken out under the 2000 Rules. Considered from the background in which this new set of rules have been brought into existence, there could be hardly any doubt that the limited restrictions on transportation and storage of sand is intended to prevent its over exploitation in the streams situated in the State of Andhra Pradesh with a view to protect the ground water. 18. Coming to the 2000 Rules, they predominantly govern the post mining/excavation activities. 18. Coming to the 2000 Rules, they predominantly govern the post mining/excavation activities. The definition of “dealer” in Rule 2(1)(d) is mainly concerned with a trader who carries on business of buying, selling, supplying, transporting, distributing or delivering for sale of minerals and mineral products. A person who processes the mineral or mineral products for sale and a mining/quarry lessee are also encompassed by the definition of “dealer” under clauses (a) and (b) of sub-clause (d) of Rule 2(1), by way of inclusive provision. As noted hereinbefore, Rule 3 prohibits any person other than a dealer or a mining lease holder from buying or selling or offering for sale or engaging in any transaction of buying and selling or transportation of any mineral for purposes of sale or consumption without being registered as a dealer. Thus, while the Rules exempt mining lease holder from taking out licence, a person who wants to carry on the activity of buying or selling or transporting the mineral is required to obtain a licence. The Rules recognise a person involving himself in buying or selling activity of mineral without being a mining/quarry leaseholder. In other words, the substantive rights of a registered dealer for trading in the mineral without holding a mining/quarry licence is governed by the 2000 Rules. Thus, on a careful analysis of these two sets of Rules, it is clearly discernible that they operate in different spheres without overlapping with each other. 19. It is in this context that Rule 9-K(3) of the 1966 Rules needs to be understood. This Rule purports to prohibit grant of dealer licence for processing/storing/stocking/selling/trading of ordinary sand to any person/firm/society/company, who is not an allottee in terms of these Rules. If one superficially reads this Rule, it, no doubt, appears that there is a blanket prohibition on trading in sand by a person other than an allottee of a sand bearing area. As observed hereinbefore, the activity of trading dehors mining/quarry lease is not intended to be governed by the 1966 Rules as the said Rules were framed under Section 15 of the Act which pertains to the regulation of grant of mining/quarry leases or other mineral concessions in respect of minor minerals and for the activities connected therewith. As observed hereinbefore, the activity of trading dehors mining/quarry lease is not intended to be governed by the 1966 Rules as the said Rules were framed under Section 15 of the Act which pertains to the regulation of grant of mining/quarry leases or other mineral concessions in respect of minor minerals and for the activities connected therewith. It is only under Section 23-C of the Act that the State Governments are empowered to make rules to regulate the post extraction/excavation of the mineral activity. A fortiori, it is the 2000 Rules which govern the substantive rights of the persons involved in these activities and very rightly the State Government has laid down the conditions regulating these activities by these Rules. 20. It is note worthy that the 2000 Rules have not been amended in consonance with Rule 9-K(3) of the 1966 Rules. The definition of “dealer” under Rule 2(1)(d) of the 2000 Rules remained unamended. Similarly, Rule 3, as it was originally envisaged and as amended by G.O.Ms.No.330, dated 14-6-2001, remained intact. The 2000 Rules being special Rules prevail over the 1966 Rules which are general in nature, to the extent of dealers’ licences on the application of the maxim “generalia specialibus non derogant”, which means special Rules prevail over general Rules. Unless these substantive rules dealing with the buying/selling/supplying/transporting activities of the mineral are appropriately amended, the rights of a dealer under the licence granted under the 2000 Rules remain unaffected. In my opinion, Rule 9-K(3) travels far beyond the scope of the rule making power of the State Government under Section 15 of the Act and therefore it has to be necessarily held that the same is ultra vires Section 15 of the Act. Whether Rule 9-K(3) fits into the scheme of the amended Rules? 21. Besides being ultra vires of Section 15 of the Act, Rule 9-K(3) does not fit itself into the framework of the amended Rules. This Rule also does not serve the purpose for which the amendments have been made. The main purpose of the amendments was to ban extraction of sand from the over exploited notified areas (Rule 9-C) and regulate utilisation of the sand extracted from the streams/rivers situated in the State of Andhra Pradesh (Rule 9-I). This Rule also does not serve the purpose for which the amendments have been made. The main purpose of the amendments was to ban extraction of sand from the over exploited notified areas (Rule 9-C) and regulate utilisation of the sand extracted from the streams/rivers situated in the State of Andhra Pradesh (Rule 9-I). The intention of the rule making authority, as reflected from these and various other provisions, such as Rule 9-D, is to preserve and protect the streams/rivers within the State of Andhra Pradesh from over exploitation of sand therefrom. Therefore, this Court does not find any rationale behind incorporating sub-rule (3) to Rule 9-K, which prohibits grant of dealer licence for processing/storing/stocking/selling/trading etc., of ordinary sand to any person/firm/society/company who is not an allottee in terms of the 2000 Rules. By confining grant of dealer licence only to allottees, inter-state trading in sand by persons who intend to bring sand from outside the State and sell the same in the State of Andhra Pradesh, such as the petitioner, is indirectly prohibited. Such prohibition, instead of serving the purpose of the amendments, will partially frustrate the purpose for which the 1966 Rules were amended. If a dealer is permitted to bring sand extracted outside the State into the State of Andhra Pradesh, that would facilitate the conservation of streams/rivers in the State of Andhra Pradesh to a large extent. On the contrary, the prohibition on importing of sand from the other States, far from serving the intended purpose of over exploitation of the streams/rivers, will prove counter-productive. Since Rule 9-I restricted taking of sand outside the State of Andhra Pradesh, a trader holding Mineral Dealer Licence can only bring sand from outside the State for sale in the State. This is what the petitioner is precisely doing. 22. In the light of this position, sub-rule (3) of Rule 9-K is not only irrational, but also unintelligible, which instead of promoting the legislative object, would try to nullify the intended purpose of the amendment, namely, prevention of over exploitation of sand in the State of Andhra Pradesh. 23. This is what the petitioner is precisely doing. 22. In the light of this position, sub-rule (3) of Rule 9-K is not only irrational, but also unintelligible, which instead of promoting the legislative object, would try to nullify the intended purpose of the amendment, namely, prevention of over exploitation of sand in the State of Andhra Pradesh. 23. Conclusions: In the light of the discussion undertaken hereinbefore, the following conclusions emerge : (a) That Rule 9-K(3) of the 1966 Rules cannot override the 2000 Rules; and (b) That the impugned proceedings by which the petitioner’s Mineral Dealer Licence has been cancelled based on Rule 9-K(3) of the 1966 Rules, cannot be sustained. 24. Result: In the result, the impugned order is set-aside and the Mineral Dealer Licence granted to the petitioner stands restored. The Writ Petition is accordingly allowed, with costs of Rs.10,000/-. 25. As a sequel to the disposal of the Writ Petition, WPMP No.17156/2013 filed for interim relief is disposed of as infructuous.