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2019 DIGILAW 581 (RAJ)

Kaladwas Chamber of Commerce Industries through its President Gopal Agrawal son of late Shri Bhanwar Lalji v. State Of Rajasthan

2019-02-19

DINESH MEHTA, SANGEET LODHA

body2019
JUDGMENT : Dinesh Mehta, J 1. By way of the present writ petition, the petitioners have challenged vires of Rules 2 (xvi), 60 (4) and 92 of the Rajasthan Minor Mineral Concession Rules, 2017 (hereinafter referred to as “the Rules of 2017”), which read thus :- “2(xvi) “Dealer” means any person who carries on the business of buying, selling, storing, distributing or processing of minerals, directly or otherwise for cash or for deferred payment or for commission, remuneration or other valuable consideration or uses minerals as a raw material;” 60. Establishment of check posts or barriers and inspection of minerals in transit and weighment.- (1) XXX XXX XXX (2) XXX XXX XXX (3) XXX XXX XXX (4) Every owner or person incharge of a vehicle shall carry with him a valid rawanna, transit pass or royalty receipt duly authenticated by the department in respect of the mineral carried and shall produce the same before any officer incharge of a check post or other officer or official empowered under sub-rule (2). Explanation: Mineral shall not cease to be mineral by reason of being subjected to any process like crushing, breaking, drying, pulverizing, calcinising or any other procedure intended to make the mineral fit or suitable for sale or consumption. 92. Transit Pass.- (1) The dealer or stockiest shall submit an application for transit pass to dispatch royalty paid mineral to Mining Engineer or Assistant Mining Engineer concerned in Form-33 duly specifying all the particulars prescribed therein. (2) The application for transit pass shall be accompanied by a copy of relevant documents of royalty payment i.e. royalty receipts, rawanna or transit pass in the name of dealer or stockiest along with receipt and dispatch register of stock. (3) On receipt of an application under sub-rule (1), after physical verification, the Mining Engineer or Assistant Mining Engineer concerned may issue transit pass in Form-34 for specified quantity and period subject to such terms and conditions as deemed necessary. The Mining Engineer or Assistant Mining Engineer may refuse to issue transit pass for reasons to be recorded in writing and communicated to the dealer. (4) The Mining Engineer or Assistant Mining Engineer shall maintain register of issue of transit pass in Form-35. The Mining Engineer or Assistant Mining Engineer may refuse to issue transit pass for reasons to be recorded in writing and communicated to the dealer. (4) The Mining Engineer or Assistant Mining Engineer shall maintain register of issue of transit pass in Form-35. (5) Rawanna, royalty receipts or transit pass submitted by the dealer in lieu of transit passes shall be stamped as "cancelled and transit pass issued" by the Mining Engineer or Assistant Mining Engineer concerned.” 2. No sooner had the learned counsel for the petitioners begun his submissions, than Mr. Sandeep Shah, learned Addl. Advocate General pointed out that the vires of these Rules has already been affirmed by a Coordinate Bench of this Court at Jaipur, vide its judgment dated 20.04.2018 rendered in case of Ajitgarh Audyogik Kshetra Udyami Sanstha Vs. State of Raj. & Ors., (DB Civil Writ No.494/2018). He further submitted that while upholding Rule 2(xvi) and Rule 60(4) of the Rules of 2017, the Division Bench has also found the circular issued by the Government, to be in sync with the Rules of 2017. 3. At this juncture, Mr. D.D. Thanvi, learned counsel for the petitioners contended that the Division Bench at Jaipur has only examined the challenge to Rule 2(xvi) and Rule 60(4) of the Rules of 2017, whereas Rule 92 of the Rules of 2017 has not been subject matter of the said writ petition. He contended that besides this, not only the facts involved in the case before Division Bench at Jaipur were different from the facts involved in the present case, even the grievance are different. Highlighting his grievance, learned counsel submitted that the petitioners besides purchasing the minerals after payment of appropriate royalty, also purchase marble slurry and mineral waste, to be processed in their grinding units/crushers. He contended that requirement of obtaining transit pass even qua the marble slurry and mineral waste is illegal, arbitrary and an unnecessary hindrance in their right to trade. 4. While advancing his arguments further, he contended that once the mineral is excavated and dispatched from mine heads, the State Government loses its authority or power to control and legislate. He contended that requirement of obtaining transit pass even qua the marble slurry and mineral waste is illegal, arbitrary and an unnecessary hindrance in their right to trade. 4. While advancing his arguments further, he contended that once the mineral is excavated and dispatched from mine heads, the State Government loses its authority or power to control and legislate. The impugned Rules, including Rule 92 of the Rules of 2017, requiring the petitioners and other similarly situated manufacturers to obtain transit pass, even in relation to marble slurry and waste, which are not minerals per se, are illegal and beyond the rule making power of the State Government, which flows from Section 15 of the Mines and Minerals (Development & Regulation) Act, 1957 (hereinafter referred to as “the MMDR Act”). 5. Mr. Thanvi, learned counsel for the petitioners cited judgment of Hon’ble the Supreme Court rendered in case of State of T.N. Vs. M.P.P. Kavery Chetty, reported in (1995) 2 SCC 402 to lend support to his case and submitted that the impugned Rules are also liable to be declared ultra vires Section 15 of the MMDR Act. 6. Mr. Sandeep Shah, learned Addl. Advocate General appearing for the respondents – State on the other end submitted that as far as Rule 2(xvi) and Rule 60(4) of the Rules of 2017 are concerned, the same have been found validly framed by the Division Bench in its judgment of Ajitgarh Audyogik Kshetra Udyami Sanstha (supra). He submitted that analogous provision of transit pass had been introduced vide Rule 5(6) of the Rajasthan Minerals (Prevention of Illegal Mining, Transpiration & Storage) Rules, 2007 and its validity stood upheld by this Court, vide judgment dated 14.03.2012 rendered in the case of M/s Shri Grinding Mills & Ors. Vs. State of Raj. & Anr. (DB Civil Writ Petition No.2823/2011). He emphasised that it has long been held that Rule 5(6) of the Rules of 2007, neither suffers from arbitrariness nor does it violate Articles 19(1)(g) and 301 of the Constitution of India. 7. Mr. Shah further added that the provision, requiring a dealer engaged in purchase, sale and use of mineral to have transit pass is well within the rule making power of the State, as the same is intended to regulate the excavation and sale of minor minerals. With respect to Rule 92 of the Rules of 2017, learned Addl. 7. Mr. Shah further added that the provision, requiring a dealer engaged in purchase, sale and use of mineral to have transit pass is well within the rule making power of the State, as the same is intended to regulate the excavation and sale of minor minerals. With respect to Rule 92 of the Rules of 2017, learned Addl. Advocate General submitted that it is simply a machinery provision and lays down mechanism for grant/issuance of transit pass and once the validity of substantive provision providing for requirement of transit pass has been affirmed, no fault nay illegality can be found in such Rule. 8. Heard learned counsel for the parties. 9. According to us, the judgment dated 20.04.2018 rendered in case of Ajitgarh Audhyogik Kshetra Udyami Sanstha (supra), covers the case at hand on all fours, at least to the extent of challenge to Rule 2(xvi) and Rule 60 (4) of the Rules of 2017. 10. We are also inclined to accept the argument of learned Addl. Advocate General that once the substantive provision prescribing the very requirement of transit pass (contained in Rule 60(4) of the Rules of 2017) has been ratified, there remains hardly anything for us to dilate upon, when it comes to ministerial provision. 11. A bare look at Rule 92 makes it crystal clear that the same is only a machinery provision, dealing with the mechanism of issuance of transit pass. No argument has been advanced before us to demonstrate that this Rule is contrary to any provision of the Act of 1957 or the same is otherwise invalid. 12. The feeble submissions made on behalf of the petitioners regarding procedural hurdles and impracticability cannot be considered or accepted as valid and sustainable ground to declare Rule 92 of the Rules of 2017 to be invalid or unconstitutional. That apart, the judgment rendered by Division Bench in case of Ajitgarh Audyogik Kshetra Udyami Sanstha (supra) wards off a dealer from the apprehended harassment. 13. In our considered opinion, the judgment in case of Ajitgarh Audyogik Kshetra Udyami Sanstha (supra) rendered by the Division Bench, excerpts whereof are being reproduced hereunder, completely sets the controversy at rest: “The challenge to definition of dealer and Rule 60 (4) of the Rules of 2017 has been made in reference to Rule 54 of the Rules of 2017. In our considered opinion, the judgment in case of Ajitgarh Audyogik Kshetra Udyami Sanstha (supra) rendered by the Division Bench, excerpts whereof are being reproduced hereunder, completely sets the controversy at rest: “The challenge to definition of dealer and Rule 60 (4) of the Rules of 2017 has been made in reference to Rule 54 of the Rules of 2017. We do not find that the provisions aforesaid are opposed to Rule 54 of the Rules of 2017. The purpose of Rule 54 is to restrict illegal mining, transportation and storage of minerals. It provides for a concession, permit or a permission for prospecting and mining operation apart form transportation and storage of mineral thus it is not limiting to prospecting and mining of the area but has been extended to transportation and storage. The transportation of the mineral is on certain conditions. The circular issued by the Government is in consonance to Rule 92 of the Rules of 2017. Rule 92 of the Rules of 2017 has not been challenged and otherwise it talks about the transit permit. It is required to be obtained as per rule and we are of the prima-facie opinion that circulars issued by the Government are in consonance to Rule 92 of the Rules of 2017. To make it very clear, this Court hold that the requirement of transit permit would be as given under Rule 92 of the Rules of 2017 and thereby, circulars under challenge are to be read in consonance to the aforesaid Rules apart from other provisions and not de hors to it. 14. With the aforesaid, we hold that the circular under challenge would apply to the extent it is in consonance to the provisions of the Rules of 2017, thereby, we are not inclined to cause interference in rule 60(4) of the Rules of 2017 coupled with other orders issued by the respondents but, instead of dismissing the writ petition, we intend to dispose it off with certain directions so that while the provisions of law are complied, unnecessary harassment is not caused to the members of the petitioner - Sanstha or other similarly situated persons. 15. 15. Accordingly, while giving effect to the provisions under challenge, if any official of the Mining Department is found involved causing harassment to the members of petitioner - Sanstha or other similarly situated persons then, on complaint, it would be adequately looked into by the Department with proper monitoring of the case. It is more so when learned counsel for petitioner has submitted that the mineral brought for further processing is not only under valid ravanna but due payment of GST is made to certify the quantum of mineral brought and processed. 16. Accordingly, members of petitioner-Sanstha are permitted to have a videography at the time of inspection so that, in case of harassment, it is produced before the Department as a token of evidence for onwards action.” 17. Moving on to the judgment of Hon’ble the Supreme Court rendered in case of MPP Kavery Chetty (supra), cited by Mr. Thanvi, we wish to observe that the same may be of some significance, while dealing with the substantive provision providing for transit pass encapsulated in Rule 60(4) of the Rules of 2017, but it has no bearing on the validity of Rule 92 of the Rules of 2017, which only provides for the manner in which the transit passes are to be issued. 18. Be that as it may, the judgment cited by Mr. Thanvi does not serve the cause of the petitioners in view of the stark difference in the facts and the provision under consideration before Hon’ble the Supreme Court vis-a-vis the facts and provision involved in the case at hands. 19. Hon’ble the Supreme Court in the case of MPP Kavery Chetty (supra), upheld the view of the High Court in striking down Rules 8-D and 19-B of the concerned Rules, which provided for fixation of price under the purported power to protect and control the excavation of granite. Relevant para Nos. 24 and 25 of the judgment aforesaid are reproduced hereinfra :- “24. There is no power conferred upon the State Government under the said act to exercise control over minor minerals after they have been excavated. The power of the State Government, as the subordinate rule-making authority, is restricted in the manner set out in Section 15. Relevant para Nos. 24 and 25 of the judgment aforesaid are reproduced hereinfra :- “24. There is no power conferred upon the State Government under the said act to exercise control over minor minerals after they have been excavated. The power of the State Government, as the subordinate rule-making authority, is restricted in the manner set out in Section 15. The power to control the sale and the sale price of a minor mineral is not covered by the terms of clause (o) of sub-section (1- A) of Section 15. This clause can relate only to the regulation of the grant of quarry and mining leases and other mineral concessions and it does not confer the power to regulate the sale of already mined minerals. 25. In our view, therefore, the High Court was clearly right in striking down Rules 8-D and 19-B as being beyond the purview of the rule-making power of the State Government. These rules having been struck down. The High Court was also right in striking down Government Order No.214 to the extent that it prescribed these rules and Government Order No.216 made in pursuance of these rules.” 20. In the present case, the State has provided for requirement of transit pass, vide Rule 60 of the Rules of 2017; opening words whereof make it abundantly clear that the same has been incorporated with a view to prevent or check the evasion of royalty. The transit passes under sub-rule (4) of Rule 60 of the Rules of 2017 have a definite nexus with curbing or controlling the evasion of royalty. That being the obvious object, in our considered opinion, the impugned rules are well within the sweep of Section 15(g) of the MMDR Act, which reads thus :- “15. Power of State Governments 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. … … … … … … … … … (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;” 21. … … … … … … … … … (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;” 21. To reiterate, the power to legislate for the purpose of collection of royalty, has enough leeway to take within its fold, the power to regulate and to check its pilferage. 22. Hence, we hold that Rule 92 is within the rule making power of the State and immuned from any Constitutional infirmity. The writ petition is hereby dismissed.