Research › Search › Judgment

Jharkhand High Court · body

2017 DIGILAW 242 (JHR)

Modi Projects Limited, Kolkatta v. Union of India

2017-02-04

APARESH KUMAR SINGH

body2017
ORDER : Heard counsel for the petitioners and Railways as well as State. 2. All these writ petitions raise common point of law on the question of deduction on account of royalty under the head “Ordinary Earth used for filling or leveling purposes in construction of embankment, roads, railways, building, etc.” from the running account bills of the petitioners under the Agreement entered into with the Respondent Railways for undertaking certain works. Agreements in most of the cases are after issuance of the Notification dated 27.12.2010, but in some of the cases, it is prior to 2010. Petitioners contend that no royalty is payable in absence of a specific notification under section 15 of Mines and Minerals (Development and Regulation) Act, 1957. 3. Today, the matter has been posted on I.A. No. 341/2017 and similar such I.A. Nos. 185/2017, 342/2017, 345/2017, 335/2017, 337/2017, 343/2017, 334/2017, 338/2017, 344/2017, 340/2017, 350/2017 and 172/2017 in other writ petitions, Petitioners have made a prayer for disposal of the writ petitions in the light of the judgment rendered by the learned Division Bench in LPA No. 705/2015 (State of Jharkhand & others versus M/s MRKR Pallavi Upkar JV & others and other analogous cases) dated 28.06.2016 and judgment rendered by this Court in WPC No. 5408 of 2014 (M/s Classic Coal Construction Pvt. Ltd. Ranchi Vs. The Eastern Central Railways and Ors.) dated 03.10.2016 following the same, enclosed to the instant Interlocutory Application. 4. Learned counsel for the respondent-State submits that writ petitions can be disposed of in that light. Learned counsel for the Respondent Railways submits that the petitioners under the contract with the Railways, had accepted to pay all statutory taxes levied by the State of Jharkhand from time to time. Petitioners are therefore liable to pay rate of royalty on the earth work and as per the terms and conditions of the Agreement. After deduction of royalty from the Bills of the petitioners, the same have been remitted to the State Government. It is submitted that in case of any change in the rates of royalty, the Respondent Railways should be entitled to refund of royalty being the Pay Master. 5. Learned counsel for the petitioners submits that statutory liability to pay royalty under the Agreement depends upon the applicability of Notification dated 27.12.2010 issued by the Mines and Geology Department, Government of Jharkhand. 5. Learned counsel for the petitioners submits that statutory liability to pay royalty under the Agreement depends upon the applicability of Notification dated 27.12.2010 issued by the Mines and Geology Department, Government of Jharkhand. Earlier, the deduction of royalty was sought to be made under Entry-5 “Ordinary Clay – Clay used for manufacturing of Raniganj tiles and commercial use” of the same notification dated 27.12.2010 which is part of Annexure-6 to the Writ Petition (Civil) No. 1911/2015. 6. This issue was agitated by several such contractors in a batch of writ petitions lead by WPC No. 4737/2014. Learned Single Judge, by judgment dated 25.03.2015, was pleased to restrain the Respondent State from realizing royalty for “Ordinary earth used for filling or leveling purposes in construction of embankment, roads, railways, building” without amending second Schedule of Jharkhand Minor Mineral Concession Rules, 2004 and without prescribing the rate of royalty for the same. It is submitted that the State of Jharkhand being aggrieved, preferred LPA No. 705/2015 (State of Jharkhand & others versus M/s MRKR-Pallavi Upkar JV & others and other analogous cases). The issue has now been settled finally by the judgment dated 28.06.2016 rendered by the Learned Division Bench in LPA No. 705/2015. Thereafter, this Court has also disposed of similar matters such as WPC No. 5408/2014 [M/s Classic Coal Construction Pvt. Ltd., Ranchi versus the Eastern Central Railways and others] by judgment dated 03.10.2016 in the light of the judgment rendered by the LPA Court. 7. Counsel for the petitioners submits that once the statutory liability to deduct royalty has been held to be covered under residuary clause at Serial No. 19 of the Notification dated 27.12.2010, the Respondent Railways cannot take a position in law that any amount of royalty deducted from the Bills of the petitioners falls under Entry-5 of the said notification. 8. Learned counsel for the Respondent Railways submits that the claim of refund between the petitioners and the Railways would also depend upon the terms and conditions of the Agreement entered into between them. 9. 8. Learned counsel for the Respondent Railways submits that the claim of refund between the petitioners and the Railways would also depend upon the terms and conditions of the Agreement entered into between them. 9. Be that as it may, the legal issue involved in the instant batch of writ petitions, as noted herein-above, is whether deduction on account of royalty under the head “Ordinary earth used for filling or leveling purposes in construction of embankment, roads, railways, building” is as per the provisions of Mines and Minerals (Development and Regulation) Act, 1957 and specific notification issued by the State Government thereunder or not? This issue has squarely been answered by the Learned Division Bench of this Court in LPA No. 705/2015, holding that the writ petitioners are liable to make payment of royalty under residuary clause at Entry-19 of the same Notification dated 27.12.2010 issued by the State of Jharkhand under section 15 of Mines and Minerals (Development and Regulation) Act, 1957. Parties have therefore to abide by the ratio rendered by the Learned Division Bench of this Court. 10. It is also worthwhile to take note that the petitioner in WPC No. 5408/2014 had clearly submitted that they are ready to abide by the terms of the Agreement and would pay royalty under the specified item no. 19 of the Notification dated 27.12.2010 at the rate prescribed. This obviously also takes care of the contention of the counsel for the Respondent Railways. 11. The statutory liability of payment of royalty for the period prior to the Notification dated 27.12.2010 would, in any case, depend upon the applicability of the Notification in vogue at the relevant time and thereafter, as per the Notification dated 27.12.2010 and the ratio rendered by this Court in LPA No. 705/2015. 12. This Court taking note of the similar plea of the parties in another writ petition being WPC No. 5408/2014 has disposed of the same on 03.10.2016 in the following manner: “Heard counsel for the parties. 2. Petitioner was aggrieved with the deduction of royalty from running on-account Bills on account of “Ordinary earth used for filling or leveling purposes in construction of embankment, road, railways, building” by treating it under the head “Ordinary Clay” used for manufacturing Raniganj Tiles and Commercial use on the ground that it is illegal and arbitrary. 3. 2. Petitioner was aggrieved with the deduction of royalty from running on-account Bills on account of “Ordinary earth used for filling or leveling purposes in construction of embankment, road, railways, building” by treating it under the head “Ordinary Clay” used for manufacturing Raniganj Tiles and Commercial use on the ground that it is illegal and arbitrary. 3. Petitioner contended that there is no such Notification bringing the Ordinary Clay within the cover of the aforesaid specification of minor minerals notified vide Annexure-8 dated 27.12.2010 issued by the Mines and Geology Department, Government of Jharkhand. Matter was decided against the State by the learned Single Judge in a batch of writ petitions lead by WPC No. 4737/2014 [M/s RAUS-SCL (JV) versus East Central Railways] vide judgment dated 25.03.2015. 4. The State being aggrieved, moved in appeal. By judgment dated 28.06.2016 passed in LPA No. 705/2015 (State of Jharkhand & others versus M/s MRKR-Pallavi Upkar JV & others and other analogous cases), Learned Division Bench of this Court has been pleased to set aside the judgment of the Learned Single Judge. It has held that the writ petitioners/ Respondents therein are liable to make payment of royalty as per Entry-19 of the same Notification dated 27.12.2010 issued by the State of Jharkhand under section 15 of the M.M.D.R. Act, 1957. 5. Earlier, Union of India had, by Notification bearing No. G S R 95(E) dated 03.02.2000 (Annexure-5) declared the “Ordinary earth used for filling or leveling purposes in construction of embankments, road, railways, buildings to be a minor minerals”. The State Government by virtue of the Notification dated 27.12.2010, had in the residuary items at Serial No. 19, included all other minor minerals not specified therein above over which, royalty at the rate of 10% of the sale price on Ad-valorem basis was to be charged. 6. Learned counsel for the petitioner submits that the petitioner is ready to abide by the terms of the Agreement and would pay royalty under the specified item no. 19 of the Notification dated 27.12.2010 at the rate prescribed. 7. Learned counsel for the Respondent State submits that the writ petition can be disposed of in the light of the judgment rendered in LPA No. 705/2015. 8. 19 of the Notification dated 27.12.2010 at the rate prescribed. 7. Learned counsel for the Respondent State submits that the writ petition can be disposed of in the light of the judgment rendered in LPA No. 705/2015. 8. In view of the issue raised by the petitioner having attained finality by the judgment passed in LPA No. 705/2015 in the case of State of Jharkhand & others (Supra), the writ petition is being disposed of in terms of the aforesaid judgment. If any amount has already been deducted from the Bills of the petitioner, it would be adjusted as per the applicable rates in terms of the aforesaid judgment. If any further liability of the petitioner remains, he would be liable to pay the same accordingly. In case any excess payment has been made by the petitioner, Respondent State would also be liable to refund the same.” 13. Accordingly, all the writ petitions are also disposed of in similar terms. Pending I.As. are closed.