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2014 DIGILAW 480 (JHR)

Central Coalfields Ltd. v. State of Jharkhand

2014-04-04

R.BANUMATHI, SHREE CHANDRASHEKHAR

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JUDGMENT Per, Shree Chandrashekhar, J. - A writ petition was filed by the appellant – Central Coalfields Ltd. seeking quashing of order dated 26.12.2012 in Certificate Case No. 06B/0102 by which the appellant was directed to pay an amount of Rs. 60,61,038.00 towards the cost of sand and interest thereupon. The writ petition was allowed setting-aside the impugned order dated 26.12.2012 subject to condition that the appellant shall deposit Rs. 25,00,000/- with the State Exchequer within a period of one month. Aggrieved by the direction to pay the amount of Rs. 25,00,000/, the appellant has preferred the present Letters Patent Appeal. 2. The brief facts of the case are that, the appellant, a Public Sector Undertaking is a Government Company within the meaning of Section 615 of the Companies Act and it is engaged in the business of mining coal. The appellant – company raises sand from nearby area for filling up the mines after extraction of the coal and for that purpose necessary permission is taken, from time to time, from the competent authority for raising sand as and when required. The appellant adhoc/advance payment of royalty from time to time and from the said amount, the royalty for sand which is removed by the appellant – company is adjusted by the Department of Mines. The appellant – company vide demand draft no. 820683 dated 25.09.1998 had deposited a sum of Rs. 2,00,000/ vide letter dated 07.10.1998 and it had also applied for extension of permission for lifting sand beyond the period 30.09.1998. The appellant thereafter, removed 1875.58 cubic meters of sand in presence of Resident Magistrate on trial and run basis, in anticipation of grant of permission and after lifting the sand, the appellant duly informed the respondent – authorities vide letter dated 26.02.1999 in this regard. However, a Certificate Case bearing no. 06B/0102 on requisition of certificate claiming an amount of Rs. 25,35,999/ was initiated against the appellant and vide order dated 26.12.2012, the claim for Rs. 25,35,999/ with interest for illegal extraction of 50,719.87 M.T. sand was held justified and the appellant was directed to make payment of Rs. 60,61,038/. Aggrieved, the appellant approached the writ court and as noticed above the learned Single Judge vide order dated 20.11.2013 directed the appellant – CCL to pay an amount of Rs. 25,00,000/ which was to be adjusted towards the future cost of sand extracted by the appellant. 60,61,038/. Aggrieved, the appellant approached the writ court and as noticed above the learned Single Judge vide order dated 20.11.2013 directed the appellant – CCL to pay an amount of Rs. 25,00,000/ which was to be adjusted towards the future cost of sand extracted by the appellant. 3. We have heard the learned counsel for the parties and perused the documents on record. 4. Mr. A. K. Das, the learned counsel appearing for the appellant – CCL has submitted that in the Certificate Proceeding the appellant appeared and informed the Certificate Officer that much prior to the requisition, the appellant had already deposited the royalty for 50,719.87 M.T. of sand and therefore, the claim of penalty by way of cost of sand and interest was not maintainable. The Certificate Officer accordingly, vide order dated 07.05.2007 directed the Requisitioning Officer to verify the records and produce evidence in respect of the sand lifted by the appellant – CCL. However, the Requisitioning Officer failed to produce any record and without ascertaining the actual facts, the Certificate Officer ordered payment of an amount of Rs. 60,61,038.00. It is submitted that since the order dated 26.12.2012 was passed without affording opportunity of hearing to the appellant, the learned Single Judge was pleaded to quash order dated 26.12.2012, however, the learned Single Judge committed error in law in directing the appellant to deposit an amount of Rs. 25,00,000/- with the State Exchequer. The contention thus, is that, at this stage when defence of the appellant – company has still to be verified and the claim of the respondent yet has not been found correct, without having adjudicated the rival claims of the parties, the learned Single Judge could not have ordered the appellant to deposit an amount of Rs. 25,00,000/-. 5. Mr. Shadab Bin Haque, the learned counsel appearing for the respondents submitted that in view of statutory provision of appeal under Bihar and Orissa Public Demand Recovery Act, 1914 even the writ petition was not maintainable. The counsel for the respondents justified the order passed by the learned Single Judge stating that the appellant has been given an opportunity to establish its case before the Certificate Officer, however, it is avoiding payment by preferring the Letters Patent Appeal on such ground which are not sustainable in law. The counsel for the respondents justified the order passed by the learned Single Judge stating that the appellant has been given an opportunity to establish its case before the Certificate Officer, however, it is avoiding payment by preferring the Letters Patent Appeal on such ground which are not sustainable in law. It is further stated that besides the Certificate Proceeding, the appellant – company is also liable to be prosecuted for theft of sand. It is stated that the Jarangdih colliery of M/s. Central Coalfields Ltd. uses sand for the purpose of sand stowing for safety measure of the mine and for that temporary permission for sand lifting was issued in favour of Jarangdih colliery by the District Mining Office, Bokaro, from time to time. He further submitted that for assessment of mining revenues, in respect of temporary permit for lifting sand for stowing issued by the District Mining Office, Bokaro a reconciliation was made in October, 1999. In the course of reconciliation and physical verification of concerned documents, it was found that in the month of May, 1997, 25355.09 M3 sand and in the month of July, 1998, 4469.25 M3 of sand had been dispatched but not shown in the monthly returns submitted by the appellant to the District Mining Officer, Bokaro. It was also found that the appellant – company had lifted 1875.58 M3 of sand during October, 1998 and December, 1998 illegally since Jarangdih colliery had no permission for lifting of sand during the period October, 1998 to December, 1998. He also submitted that all these quantities (25355.09 M3 + 4469.25 M3 + 1875.58 M3 = 31699.92 M3 equivalent to 50,719.87 Metric Tonnes) of sand is liable to be charged @ price of mineral under section 21(5) of Mines and Minerals (Development & Regulation Act, 1957. Therefore price of mineral 2535998 (@ Rs. 50 per metric tonnes) for 50719.87 metric tonnes of illegally raised and dispatched sand was demanded vide Office letter no. 1541 dated 30.11.1999 and there after many reminders were issued from the office of the District Mining Officer, Bokaro to realise the due amount. When due amount was not paid by the colliery, a Certificate Case No. 6B/200102 was filed against the Project Officer, Jarangdih colliery as per the provision of Bihar and Orissa Public Demand Recovery Act, 1914 to realise the public demand. 6. When due amount was not paid by the colliery, a Certificate Case No. 6B/200102 was filed against the Project Officer, Jarangdih colliery as per the provision of Bihar and Orissa Public Demand Recovery Act, 1914 to realise the public demand. 6. We have perused the materials on record which indicates that a Certificate Case bearing no. 06B/0102 was initiated on 26.09.2001. Thereafter, the proceeding continued for more than 11 years during which the appellant – CCL had ample opportunity to produce the materials and record to substantiate its claim that there was no illegal extraction of sand by it. The claim of the appellant – CCL is that, from time to time permission for raising of sand was obtained by the appellant and for the period in question that is, between October and December, 1998 also extension was granted vide order dated 26.02.1999. The learned counsel appearing for the respondent has submitted that vide letter dated 03.02.1999, a show-cause notice was issued to the Project Officer, Jarangdih Colliery, BTPS, Bokaro of M/s. CCL for furnishing false information and only thereafter the Certificate Case was initiated against the appellant – company. From notice dated 03.02.1999 it appears that by letter no. 809 dated 27.06.1998, the District Mining Officer, Bokaro had extended the period of temporary permission for raising of sands till 30.09.1998. The permission was further extended from 01.01.1999 to 31.05.1999. It appears that between the period October 1998 and December 1998, there was no permission for raising of sand however, from the monthly details submitted by the appellant the District Mining Officer, Bokaro found that the appellant has also raised sand during the said period. It is also a matter of record that the Certificate Proceeding bearing no. 06B/0102 was initiated on 26.09.2001 and it was dragged till the year, 2012. The learned counsel for the respondent has submitted that the appellant has been trying to delay the payment. The respondents have given specific details of the illegal raising of sand and it has calculated the total quantity of sand for the period in question at 50,719.87 MT. The appellant has been made liable in terms of Section 21 (5) of the Mines and Mineral Regulation Act, 1957 and is required to pay price of mineral at the rate of Rs. 50/ per metric ton. Vide letter dated 30.09.1998, an amount of Rs. The appellant has been made liable in terms of Section 21 (5) of the Mines and Mineral Regulation Act, 1957 and is required to pay price of mineral at the rate of Rs. 50/ per metric ton. Vide letter dated 30.09.1998, an amount of Rs. 25,35,998/ for a quantity of 50,719.87 MT of illegally raised and dispatched sand was demanded by the respondents and thereafter, many reminders were also issued from the office of the District Mining Officer, Bokaro. However, the due amount was not paid by the appellant. The learned Single Judge has interfered with order dated 26.12.2012 passed by the Certificate Officer on the condition that the appellant shall deposit Rs. 25,00,000/ with the State Exchequer. The payment of such amount has been made subject to future adjustment, if the plea of the appellant is accepted by the Certificate Officer and Certificate Proceeding is terminated. 7. The remedy under Article 226 is a discretionary remedy and the learned Single Judge has exercised jurisdiction inspite of availability of the statutory remedy of appeal under the Bihar and Orissa Public Demand Recovery Act, 1914. Exercise of power under Article 226 of the Constitution of India being discretionary in nature, the High Court can no doubt prescribe conditions while remanding the matter to the statutory authority for a decision afresh. It is stated by the appellant – CCL that it used to make adhoc/lumpsum payment to the Department of Mines and from the payment so made, the amount of royalty for raising of sand is being adjusted by Stateauthority. The learned Single Judge has also ordered that the amount of Rs. 25,00,000/ would be adjusted towards future payments. 8. We find no error in the order passed by the learned Single Judge and accordingly, this Letters Patent Appeal is dismissed.