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2017 DIGILAW 1144 (ALL)

GULAB CHANDRA MISHRA v. STATE OF U. P.

2017-05-01

DILIP B.BHOSALE, YASHWANT VARMA

body2017
JUDGMENT : By the Court.—Heard Sri M.D. Singh ‘Sekhar’, Senior Advocate assisted by Deo Prakash Singh, Sri Deobrat Mukherjee and Mrs Amrita Rai for the petitioners and Sri Raghvendra Singh, learned Advocate General assisted by Sri R.K.S. Chauhan for the State respondents. 2. This batch of writ petitions had been preferred challenging the validity of Rule 9-A of the U.P. Minor Mineral (Concession) Rules 1963 (1963 Rules). Various other reliefs were also sought in the writ petitions including a challenge to the Government Order dated 22 October 2014 which in turn had brought to an end a declaration dated 31 May 2012 mandating settlement of mining leases in the State of U.P by way of e-tender in terms of Part-IV of the 1963 Rules. These writ petitions were allowed on 3 April 2015 whereby the following operative directions were issued : “(I). The word “lease” as used in Rule 34 of the Concession Rules in the matter of making of the application for environmental clearance/approval of the mining plan may be read to mean “selected applicant” only and if required the State Government may make necessary amendments therein. (II). No mining lease under the Notification dated 22.10.2014 shall be executed by the State Government, unless there is an approved mining plan complete in all respect, as contemplated by Model Rules, 2010, prepared by a recognized qualified person and duly approved by the competent authority. Approval of the mining plan in writing is a condition precedent for execution of the mining lease. The deeming provision as contained in Rule 34 (4) is held to be bad and is quashed. (III). No mining operations can be done in the absence/contrary to the mining plan prepared by a recognized qualified person and approved by the competent authority, as contemplated by Model Rules, 2010 read with Rule 34 of the Minor Mineral Concession Rules as amended upto date. (IV). Rule 9A, as introduced by 37th Amendments, is held to be bad being in conflict with Rule 23(3) of the Minor Mineral Concession Rules, 1963. (V). All the notifications issued by the District Magistrate, included that dated 5th December, 2014, inviting applications from the prospective applicants in envelope-A and envelope-B cannot be legally sustained and are quashed. (VI). (IV). Rule 9A, as introduced by 37th Amendments, is held to be bad being in conflict with Rule 23(3) of the Minor Mineral Concession Rules, 1963. (V). All the notifications issued by the District Magistrate, included that dated 5th December, 2014, inviting applications from the prospective applicants in envelope-A and envelope-B cannot be legally sustained and are quashed. (VI). The State Government may lay down the time period for the selected candidate to make the application for approval of mining plan and for such approval being examined and decided in a time bound manner by the competent authority.” 3. The State took the matter in appeal to the Supreme Court wherein initially the Special Leave Petitions were entertained and certain interim directions issued. By an order dated 22 November 2016, the matter was remitted for a hearing afresh in the following terms : “We have heard learned counsel for the parties for a considerable period of time and have also gone through the pleadings. We find during the hearing that a large number of issues have been raised both by the writ petitioners as well as by the State. Many of the issues that have been raised have been brought to our notice for the first time. On the other hand, learned counsel for the State says that certain aspects, which were mentioned in the counter-affidavit filed in the High Court relating to payment of royalty on the dispatched minor minerals, have not at all been adverted to by the High Court. In view of the above, in our opinion, these matters require to be remitted to the High Court and reconsidered in the light of the submissions that have been made by learned counsel for the parties. Accordingly, we set aside the impugned judgment and order passed by the High Court without expressing any opinion on the averments of the case. The special leave petitions and writ petition are disposed of. The parties are at liberty to file an additional affidavit before the High Court within two weeks from today. List the matters before the High Court on 9th December, 2016 so that the High Court can decide when to take up the matters for final hearing. The interim orders passed by this Court from time to time will continue till the matters come up before the High Court. List the matters before the High Court on 9th December, 2016 so that the High Court can decide when to take up the matters for final hearing. The interim orders passed by this Court from time to time will continue till the matters come up before the High Court. We make it clear that the High Court can modify the interim orders that have been passed by us, but after hearing learned counsel for the parties. The parties will maintain status quo till 9th December, 2016. Since the rights of several parties are involved and the revenue of the State is involved, we request the High Court to try and dispose of the matters as expeditiously as possible. Pending applications are disposed of.” 4. On 19 April 2017, when this batch of writ petitions were called before us, the learned Advocate General had made a statement that the Government was actively engaged in revamping the entire mining policy in the State of U.P. He further made a statement that considering the anxiety expressed in various orders passed by the Court in respect of the acute shortage of minor minerals being faced in the State, it had been decided to take steps under Chapter VI of the 1963 Rules by issuing temporary permits for a maximum period of six months. The operative directions in the order dated 19 April 2017 reads thus : “In the meantime, if the State decides to take steps or to start process under Chapter VI of the Uttar Pradesh Minor Minerals (Concession) Rules, 1963, i.e. issuance of temporary permit for a maximum period of six months, as submitted by learned Advocate General, they may do so, but shall not grant any permit till the next date of hearing. They are also directed to make it clear to all interested parties, who may participate in the process under Chapter VI, that it would be subject to further orders that will be passed by this Court on the next date. The statement made on behalf of the State by learned Advocate General that they shall not grant any preferential right under Rule 9-A of the Rules, is recorded and accepted.” 5. The statement made on behalf of the State by learned Advocate General that they shall not grant any preferential right under Rule 9-A of the Rules, is recorded and accepted.” 5. Pursuant to the aforesaid order and when this batch was called today, the learned Advocate General has submitted an affidavit bringing on record a Government Order dated 22 April 2017 addressed to all the District Magistrates in the State of U.P apprising them of the procedure to be adopted for grant of short-term mining permits. We deem it appropriate, for the sake of convenience, to extract paragraph 4 of the affidavit filed today which reads thus : “4. That as per the undertaking given by the Learned Advocate General before this Hon’ble Court, the State Government decided to start process under Chapter-VI of the U.P. Minor Mineral Concession Rules, 1963 i.e. Issuance of temporary mining permits for a maximum period of six months as interim arrangements but shall not grant any permit till the further orders of this Hon’ble Court. Accordingly as per order/directions of this Hon’ble Court dated 19.4.2017 the State Government proceeded and formulated the procedure for grant of short term mining permits to the suitable applicants. The proposed scheme of State Government is given herein below : That the state Government has issued a Government Order No. 715/86-2017-5(Sa)/2014 dated 22 April, 2017 directing all the District Officers of the state to invite e-tenders for issuance of short term permits for the period of 6 months. After obtaining NOC from respective District Forest Officers, for mining of Sand/Morrung river-bed mineral from such sites where no stay order has been granted by Hon’ble Court’s/NGT. That these short term e-tenders process are to be completed by 12 May, 2017 and letter of intent is to be awarded to highest bidders by 15th May, 2017. After issuance of Lol, the concerned party shall obtain Environmental Clearances as per M/O Environment & Forest Guidelines before starting mining. That no Mining is to be done on these permits during monsoon period of 1st July 17 tp 30 Sept. 2017. That no extension or renewal of these short term permits shall be allowed beyond the above said period of 6 months. That no Mining is to be done on these permits during monsoon period of 1st July 17 tp 30 Sept. 2017. That no extension or renewal of these short term permits shall be allowed beyond the above said period of 6 months. That the above Government Order clearly states that e-tenders shall be subject to orders of Hon’ble Court/NGT (Para-21 of the G.O.) That the State Government has initiated a poliy reforms relating to issuance of lease of Sand/Morrung and other river bed minerals to ensure that these areas are leased on a long term basis following e-tenders/e-auctions/e-bidding processes only for a period of not less than 5 years. These leases will not be renewed or extended beyond their expiry and on its expiry; new leases would be awarded based on fresh e-tender/e-auction/e-bidding only. That the State Government has started the process of amending the U.P. Minor Mineral Concession Rules, 1963 to achieve the policy state above in para 6. These amendments relating to riverbed mining leases including omission of Rule 9A in Chapter-II are expected to be notified by 15th June, 2017. After notification of the amendment of above rules, the State Government proposes to invite e-tenders/e-auction/e-bids within one month from the date of expiry of the current river bed mining leases or vacation of stay orders of Hon’ble Courts of these areas. That the e-tenders/e-auctions/e-bids will be invited giving minimum 30 days notice and shall be awarded only on highest offer/bid basis.” A reading of the Government Order dated 22 April 2017 evidences the same having been made in exercise of powers conferred by Rule 68 of the 1963 Rules in the interest of development of minerals as well as in public interest. Shorn of unnecessary details, the order perceives the following steps being taken : (a) Grant of short-term mining permits for a period of six months in and over areas which are not affected by any interim orders passed by Courts of law. The order further clarifies that no mining activities shall be permitted during the monsoon season beginning from 1 July 2017 to 30 September 2017. The order further provides that no extension to the period of six months including on the ground of obstruction of mining operations would be granted. The order further clarifies that no mining activities shall be permitted during the monsoon season beginning from 1 July 2017 to 30 September 2017. The order further provides that no extension to the period of six months including on the ground of obstruction of mining operations would be granted. (b) The principles for identification of mining areas, availability of minor minerals, transportation facilities as well as steps to ensure sustainable mining operations bearing in mind the state of the environment in the area would also be formulated. (c) A committee headed by the District Magistrate and comprising of the Mines Officer, Mines Inspector and other members would estimate the total quantity of minor minerals likely to be extracted and present in the area in question. (d) The advertisement inviting e-tenders shall indicate the estimated quantity of minor minerals present in the area in question. (e) E-tenders would have to be submitted quoting rates per cubic meter which would not be lesser than the rates of royalty prescribed in the First Schedule to the 1963 Rules. (f) Compliance with all other statutory and environmental norms to be adhered to. (g) Requirement of the intending bidders to deposit 75% of the total royalty liable to be paid on the estimated quantity of minerals present in the area. This security is to be deposited in the shape of bank drafts with the concerned District Magistrate and a copy of the bank draft to be duly produced before opening of e-tenders. 6. In addition to the above, the learned Advocate General made a statement that this temporary arrangement which envisages the grant of short-term permits for a period of six months is only for the interim period till the State Government is able to make necessary amendments to the 1963 Rules and further take steps to delete Rule 9-A from the statute book itself. All these amendments, the learned Advocate General states, shall be effected by 15 June 2017. The learned Advocate General has further submitted that the State Government in terms of the policy measures enumerated in the order dated 22 April 2017 shall not take recourse to or grant any preferential rights envisaged by Rule 9-A while settling the short term permits in terms of the policy referred to above. The learned Advocate General has further submitted that the State Government in terms of the policy measures enumerated in the order dated 22 April 2017 shall not take recourse to or grant any preferential rights envisaged by Rule 9-A while settling the short term permits in terms of the policy referred to above. He further stated that under no circumstances would the permit holder be permitted to extract or transport minor minerals in excess of the quantity set forth in the permit and estimated by the committee of the District Magistrate. 7. Initially the learned counsels appearing for the petitioners sought to contend that the policy as framed would be open to misuse by syndicates and persons acting in concert who may proceed to mine much more than the quantity of minor minerals estimated to be present in the area by the committee headed by the District Magistrate. However, this apprehension stands fully allayed in light of the statement made by the learned Advocate General referred to above. Several objections, which were taken to the adoption of e-tender process for settlement of short-term permits, was based upon the contention that the provisions of Chapter VI did not comprehend the grant of permits by way of e-tender. 8. To this, we may only note that the order dated 22 April 2017, strictly speaking, neither emulates nor prescribes a procedure in terms identical to those envisaged under Chapter VI. This primarily because the order, as we have noted above, is made with reference to Rule 68 of the 1963 Rules which confers a power upon the State Government to relax the provisions of any rule/s in the interest of mineral development. Since the order has been passed in exercise of powers conferred by Rule 68, the submission of the learned counsels to the requirement of a strict adherence to the provisions comprised in Chapter VI is untenable. 9. Similarly the objections based upon a reading of Rule 54 are also misconceived. Rule 54 envisages the deposit of royalty in respect of the quantity of minor minerals which is permitted to be excavated pursuant to a permit granted under the said Chapter. 9. Similarly the objections based upon a reading of Rule 54 are also misconceived. Rule 54 envisages the deposit of royalty in respect of the quantity of minor minerals which is permitted to be excavated pursuant to a permit granted under the said Chapter. The Government Order dated 22 April 2017 in clear and unequivocal term provides that the bid amount shall in no case be lesser than the royalty payable upon the quantity of minor minerals which are estimated to be present in the area in question. The interim policy therefore clearly envisages the submission of a bid which is over and above the total royalty payable on the quantity of minor minerals excavated. The situation of Rule 54 being breached would therefore not arise at all. 10. The precarious condition prevailing in the State and the acute shortage of minor minerals has been noticed in various writ petitions including in PIL No. 6827 of 2017, (Amitabh Singh v. State of U.P. and others) by the Lucknow Bench of this Court. The steps presently taken by the State Government are in accord with the directions issued and are clearly intended to meet the exigencies of the situation. We may only note the following observations which appear in the order of the Division Bench at Lucknow made on 18 April 2017 in the PIL aforementioned. The relevant extract of the order reads thus : “While this Court appreciates the efforts made by the State Government in ensuring that illegal mining of minor minerals in the State comes to a halt, and that as per the records made available to the Court, such illegal activity has been made negligible because of the efforts of the State, but the story will not end here, inasmuch as it is for the State to ensure that legally excavated minor minerals are made available for construction activities throughout the State of Uttar Pradesh, both for the State Government as well as for the Private Operators within reasonable time and at reasonable cost. The State Government itself has taken note of the prevailing situation where, because of paucity of legally available minor minerals being sold in the open market, the entire construction activities, both by the Government as well as private agencies have to come to a halt, which can never be in the interest of State. The State Government itself has taken note of the prevailing situation where, because of paucity of legally available minor minerals being sold in the open market, the entire construction activities, both by the Government as well as private agencies have to come to a halt, which can never be in the interest of State. We have been informed that since 2012, there has been no grant of any fresh lease by the State Government under the Minor Mineral Concession Rules and whatever, licences/leases/permits were granted earlier have either been set aside by the orders of the High Court/Supreme Court or have been kept in abeyance. The situation must improve and must improve fast. Today a letter of the Under Secretary, Uttar Pradesh dated 13th April, 2017 addressed to the Director Geology and Mining, Uttar Pradesh, Lucknow has been produced before this Court and we find that on the recommendation of Group of Ministers (GOM) certain immediate steps have been recommended for granting permits/leases for 6 months to tide over the emergent situation but no concrete steps have been disclosed as to how the State Government would ensure that such mining leases/permits will be issued for excavation or mining of minor minerals to be made available in the open market. We have been informed that the State of Uttar Pradesh has made amendment in Rules 17 of the Minor Minerals (Concession) Rules 1963 by the amending Rule 17 whereby the restriction earlier imposed on import of minor minerals from other States has been lifted. This may, to some extent, ease the situation but in absence of any homework having been done by the State Government as to what is the exact quantity of minor minerals, which is required in State of Uttar Pradesh on per month basis for actual consumption and what actual quantity can be transported from other States, including the cost factor, we are not in a position to record that such relaxation in Rules 17 would serve the purpose. In our opinion, the State must come out with some concrete proposal in a time bound manner to ensure that legal and valid permits/licences/leases are issued in the matter of excavation of minor minerals and for the same the State must also suggest the amendment, if any, required under the existing Rules of 1963 keeping in mind the power conferred under Section 68 of the Minor Mineral Concessions Rules, which may, in our opinion, help in salvaging the emergent situation. We are also of the opinion that the State must lay down certain guidelines to be followed by the District Level Committees in the matter of grant of permits which may be issued and may safeguard the interest of the State requiring the participants/applicants and to deposit the entire deed rent and require them to present the demand draft. We are also conscious of the fact that before initiation of the process of settling leases/permits by way of auction proposed to be undertaken, notifying the areas under Chapter IV of the Rules of 1963 would be necessary and the State must also keep in mind the aforesaid provisions and must do the needful. We are also of the opinion that applications which may be received in respect of the removal of minor minerals collected in the ‘bhumidhari land’ of recorded tenure holders under Rules 52-A of the Minor Mineral Concession Rules must also receive immediate attention of the District Magistrates and for the said purpose appropriate orders need to be passed in a time bound manner. The State must issue guidelines for the said purpose to the District Magistrates concerned. We may record our anxiety that such directions are being given in the peculiar facts of the case that not only is the construction activity has been adversely affected because of acute paucity of minor minerals in open market, it has also created a situation where these are being sold, where ever available, at exorbitant prices and, further, that if the mining activity is not initiated immediately in the State of Uttar Pradesh the natural resources to this State may get lost because of ensuing monsoon season which we all know many times leads to heavy floods in all major rivers including Ganga, Yamuna and Betwa. The State must protect its resources and take them to the best possible use. The State must protect its resources and take them to the best possible use. We may record that on a simple reading of Rules 68 of Minor Mineral Concession Rules 1963, it would be clear that the State Government has been given overriding power to issue such orders as may be necessary in the interest of Mineral Development in the State. The power so given to the State Government is all pervasive and the State must respond to the situation keeping in mind the Provisions of Rules 68. It will not be correct to suggest that it is only in a particular case that State can resort to its power under Section 68. Such power cannot be confined to particular cases. We, therefore, require the Principal Secretary/Additional Cabinet Secretary, Department of Mining to file his personal affidavit on or before Friday i.e. 21st April, 2017 indicating the action plan which the State proposes for settling the licences/permits in terms of the recommendation of Group of Ministers for a period of 6 months. The proposal must disclose that action plan shall be implemented in a time bound manner.” 11. We therefore permit the State Government to proceed with the implementation of the interim mining policy as embodied in the order dated 22 April 2017 and vacate any interim orders operating on this batch of writ petitions which may restrain or restrict the State Government from proceeding further in terms of the Government Order aforementioned. Since the learned Advocate General has made a statement that the provisions of Rule 9-A shall not be given effect to and no preferential rights will be granted, we find no justification to retain this batch of writ petitions on board at this stage. This more so in light of the stand taken in the affidavit and the statement of the learned Advocate General that Rule 9-A shall be deleted from the statute book by 15 June 2017. We therefore only observe that in case the State fails to take steps in light of the statement made on affidavit and the submission of the learned Advocate General, it shall be open to the writ petitioners to either seek a revival of these proceedings or to institute fresh writ petitions challenging the relevant provisions of the 1963 Rules. We therefore only observe that in case the State fails to take steps in light of the statement made on affidavit and the submission of the learned Advocate General, it shall be open to the writ petitioners to either seek a revival of these proceedings or to institute fresh writ petitions challenging the relevant provisions of the 1963 Rules. We also further clarify that in respect of all other amendments that the State Government may proceed to make in the 1963 Rules in light of the statement made upon the affidavit filed today, it shall be open to the writ petitioners to assail the same independently if circumstances so warrant. With the aforesaid observations, Writ Petition (PIL) No. 1498 of 2015 as well as all connected matters shall stand disposed of. Let a photocopy of this order, duly authenticated by the Bench Secretary be placed on the record of all connected writ petitions. Office and parties shall proceed on the basis of the authenticated copy of the order placed on the record of all connected writ petitions.