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2017 DIGILAW 816 (ORI)

S. T. Minerals Private Limited v. State of Orissa

2017-07-31

K.R.MOHAPATRA, VINEET SARAN

body2017
JUDGMENT : Vineet Saran, J. The dispute in the present writ petition is with regard to the period for which lease has been granted in favour of the petitioner for minor mineral (Black Stone Quarry). 2. The admitted facts of the case are that an auction notice for a particular lease area of minor mineral was issued by the Tahasildar, Dharmasala (opposite party no.5) on 19.6.2014. The auction was scheduled to be held on 18.7.2014 (1st phase), then in 2nd phase on 25.7.2014; and the 3rd phase on 01.08.2014. The petitioner was the sole participant in the auction held on 18.7.2014 and its sole bid for Rs.12,40,000/-was accepted by the opposite party. The petitioner was required to obtain Forest & Environmental clearance, etc., which was granted by the District Environment Impact Assessment Authority, Jajpur, Odisha on 31.3.2016. Thereafter on 05.04.2016, a lease agreement was executed in favour of the petitioner for a period of one year, for which necessary deposit of 1% of the auction amount, which came to Rs.1,24,000/-, was made by the petitioner with the District Minerals Foundation Fund. The lease deed executed on 05.04.2016 specified that the period of lease would be from 31.03.2016 to 30.03.2017. 3. The petitioner contends that since in the meantime, the Orissa Minor Minerals Concession Rules, 2004 (for short, “2004 Rules”) was amended with effect from 16.09.2014 and Rule 36, which earlier provided for the maximum period of lease to be granted for a period of one year was deleted, and the amended Rule-27 provided that the grant of lease would not be for a period of less than five years, which was in terms of the directions issued by the Apex Court in the case of Deepak Kumar v. State of Haryana, (2012) 4 SCC 629 . Relying on such directions, other amendments were also brought in the 2004 Rules. The petitioner thus contends that the lease agreement executed on 05.04.2016 could not have been for a period of less than five years. In the meantime, by order dated 28.09.2016 passed by the Tahasildar-opposite party-5, the petitioner was required to deposit royalty along with other charges in favour of the Government against the annual mining plan for the year 2016-17, which came to Rs.1,84,90,112/-, which included royalty amount of Rs.1,49,95,728/-. In response to that, the petitioner submitted its objection on 18.10.2016. In the meantime, by order dated 28.09.2016 passed by the Tahasildar-opposite party-5, the petitioner was required to deposit royalty along with other charges in favour of the Government against the annual mining plan for the year 2016-17, which came to Rs.1,84,90,112/-, which included royalty amount of Rs.1,49,95,728/-. In response to that, the petitioner submitted its objection on 18.10.2016. After considering the said objection of the petitioner, the Tahasildar-opposite party no.5 passed a detailed order reiterating the earlier demand dated 27/28.09.2016. This writ petition has thus been filed with a prayer for quashing the aforesaid demand raised by the Tahasildar, and also for a direction to the State authorities to renew the Sairat Source No.87 of 2014-15 for a period of five years in favour of the petitioner, as per the judgment of the Apex Court in the case of Deepak Kumar (supra). 4. We have heard Shri S. Palit, learned counsel for the petitioner as well as Shri P.K. Muduli, learned Addl. Government Advocate appearing for the State-opposite parties at length and perused the record. 5. Pleadings have been exchanged between the parties, and with consent of the learned counsel for the parties, this writ petition is being disposed of at the admission stage. 6. It is not disputed that the advertisement for auction of the lease area in question was issued on 19.06.2014, which specified that the same shall be for the year 2014-15, with the further stipulation that it would be for one year from the date of auction. Admittedly, the auction took place on 18.07.2014 and the one year from the date of auction was to end on 17.07.2015. In the said auction notice, besides the aforesaid, certain specific conditions had been provided for [as per the judgment of the Apex Court in the case of Deepak Kumar (supra),] the English translation of which reads as under : Sealed tender is invited for auction of minor mineral sources for the year 2014-15 (one year from the date of auction) as per following schedule …………………………… ................................................................................................. “Specific Condition : As per the Letter No.13377 dated 19.07.2012 of the Forest & Environment Department of the Government of Orissa in accordance with the order of the Hon’ble Apex Court (S.L.P. No.19628, 19629/2009), and Letter No. J 13012/12/2013-IA-II(I) of the Forest & Environment Ministry of the Government of India, the auction holders will be bound to abide by all the conditions relating to environment. Besides, the auction holder shall deposit additional 25% of the bid amount to the Orissa Environment Management Fund Trust, Bhubaneswar through Bank Draft through the undersigned.” (emphasis supplied) 7. From the above, it is clear that when the petitioner participated in the auction, two conditions were absolutely clear i.e. the period of lease was to be for one year from the date of auction (i.e. 18.07.2014 to 17.07.2015) and the second one was that the petitioner was required to get the Forest and Environmental Clearance, etc. from the concerned departments. It appears that since such conditions were imposed, no person other than the petitioner participated in the auction. It is not disputed that even though the petitioner was the sole participant in the auction held on 18.07.2014, the same was not postponed for the 2nd and 3rd phases, which had been specified in the auction notice itself. The petitioner after having accepted the terms of auction notice, participated in the auction, and now turns around and claims that in view of the recommendations of the Apex Court made in the case of Deepak Kumar (supra), the terms of the auction should have been five years and, thus, the lease executed in favour of the petitioner on 05.04.2016, which was for a specified period of one year, should be treated as to be for a period of five years. 8. The above contentions of the learned counsel for the petitioner, in our considered view, is not worthy of acceptance. 9. Knowing fully well that the lease period was for one year only, and also that the requirement was to fulfill certain conditions specified in the auction notice as per the recommendations of the Apex Court made in the case of Deepak Kumar (supra) (which was issued in 2012), the petitioner participated in the auction. The conditions recommended in the case of Deepak Kumar (supra) had been incorporated in the auction notice. The conditions recommended in the case of Deepak Kumar (supra) had been incorporated in the auction notice. The recommendation made that the period of lease should be five years was yet to be incorporated in the Rules, which was subsequently incorporated by way of amendment of the 2004 Rules only with effect from 16.09.2014, of which the petitioner had full knowledge. It appears that because of such conditions, no other persons participated in the auction, and now, if any condition is changed by the Court or by the State Government, the same would be unreasonable, as other persons would have also participated in the auction had they known that the conditions in the auction notice would be subsequently changed. In a similar case of M/s. B.M.P & Sons Pvt. Limited v. State of Odisha & others, 2016 (II) OLR 313, where the highest bidder in an auction held for the period 2014-15, which was also for a period of one year, had prayed for extension of the period of lease from one year to five years in view of the judgment of the Apex Court in the case of Deepak Kumar (supra) and the subsequent amendment in the 2004 Rules, this Court has in paragraphs-7 and 8 observed as under : “7. Applying the above mentioned statutory interpretation to the present context, under Rule 36 of Orissa Minor Mineral Concession Rules, 2004, which relates to the period of lease, it was earlier provided that the maximum period for validity of an auction shall not exceed one year, but the same has been amended with effect from 16.09.2014 providing for fresh leases to be granted for a period of five years. From the above, what can be inferred is that where fresh auction are held after the amendment, the lease period would be of five years. It cannot be construed to mean that where auctions have already been held earlier for a period of one year, the same would be automatically extended to five years. 8. The consideration for offering the bids, when the mining lease period is of five years, is totally different from the one where the mining lease period is of one year. The bid amount for long term leases would be different. 8. The consideration for offering the bids, when the mining lease period is of five years, is totally different from the one where the mining lease period is of one year. The bid amount for long term leases would be different. The petitioner had offered its bid for one year in the auction which was held for the year 2014-15, which was after the judgment of the apex Court in the case of Deepak Kumar (supra). The bidders in such auction had offered their bid, keeping in mind that the lease to be executed was to be for one year. Extending the period of lease after the auction is finalized, would amount to changing the terms of the auction after its finalization, which is not permissible in law. On the basis of the said bid, the petitioner cannot thus be permitted to be granted a lease for a period of five years. As such, the claim of the petitioner for extension of lease for a period of five years, on the basis of the petitioner being the highest bidder for the auction held in the year 2014-15, does not deserve to be granted.” (emphasis supplied) 10. In view of the aforesaid, we are of the opinion that the recommendations made by the Apex Court in the case of Deepak Kumar (supra) were brought in force by way of amendment, which was incorporated with effect from 16.09.2014, and, the auction in the present case was held prior to the said date. As such, it would be the law as on the date of the auction, which would be enforceable and the terms laid down in the auction notice which alone can be considered. 11. In view of the aforesaid, the later prayer made in the writ petition for extension of the period of lease from one year to five years does not deserve to be granted. 12. In the facts of the case, because of change in law after the auction (i.e. on 18.07.2014) and before the execution of lease (i.e. on 05.04.2016), we are not commenting as to in what circumstance the lease agreement was executed by the State Government on 05.04.2016 for a period of one year, much after the lease period for which auction had taken place had expired on 17.07.2015. 13. 13. As regards the other prayer, which is with regard to demand of royalty for the year 2016-17, the learned counsel for the parties do not dispute that the order of the Tahasildar dated 24.12.2016 passed after considering the objection of the petitioner in response to the notice dated 27/28.09.2016, is appealable before the Sub-Collector. In view of the petitioner having alternative remedy, which has not been availed by it, we would not be inclined to entertain such prayer on merit. However, considering the submission that the said order had been challenged before this Court and the matter remained pending, we direct that if the petitioner files an appeal under the relevant Rules before the Sub-Collector within three weeks from today along with a certified copy of this order, the same shall be considered and decided on merits and in accordance with law, without taking any objection with regard to delay. Further, if any application for waiver of the condition imposed under the Rules is filed along with the appeal, the same shall also be considered by the Sub-Collector in accordance with law. With the aforesaid observations/directions, the writ petition stands disposed of.