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2020 DIGILAW 531 (AP)

B. Rajan v. State of Andhra Pradesh, Mines and Geology Department

2020-08-17

K.VIJAYA LAKSHMI

body2020
ORDER : K. Vijaya Lakshmi, J. 1. Heard Sri O. Manoher Reddy, learned counsel for the petitioner, and learned Government Pleader for Mines and Geology and with their consent, this writ petition is being disposed of at the stage of admission. 2. This writ petition is filed questioning the Memo No. 5679/M.I(1)/2019- 2 dated 21.07.2020 of the 1 respondent in dismissing the revision application filed under Rule 35-A of the A.P. Minor Mineral Concession Rules, 1966 (for short "Rules'). 3. (a) Case of the petitioner is that, he was granted quarry lease for Silica sand in Survey No. 36/P of Addepally village, Chillakur Mandal, SPSR Nellore District, admeasuring an extent of 16.512 hectares in the year 2010 and since then, he has been conducing mining operations without contravening any of the conditions of mining lease or the provisions of the Mines and Minerals (Development and Regulation) Act, 1957 (for short 'the Act') and subsequently under the provisions of the A.P. Minor Mineral Concession Rules, 1966. (b) While so, the Sub Collector, Gudur constituted teams for joint inspection of silica sand mining leases and has submitted a report to the 4th respondent; based on the said report, the 4 respondent issued show cause notice dated 24.07.2019 to the petitioner, alleging that there is variation between the total extracted quantity and the permitted quantity of about 81,029 MT, that dispatch permits obtained by the petitioner are for lesser quantity than the mineral extracted from the leased area and that the petitioner transported the difference of 81,029 MT without valid seigniorage fees. (c) To the said notice, petitioner submitted his representation on 08.08.2019 stating that the mine was not inspected in his presence and also requested to furnish the sketch showing the pits whose measurements were taken, the working sheet of how the volume and tonnage worked out, statement showing year wise permitted quantity and actual dispatch taken into account, copies of mineral revenue assessment from the date of inception, any evidence basing on which the presumption of having dispatched the quantity from the mine and whether the stock available at mine head was measured and taken into account while calculating the quantity of mine dispatched, if so, the measurements of the stock available at mine head and also stated that the reply to the show-cause notice shall be submitted after receipt of the above information. (d) Without furnishing the said information, the 4 respondent issued demand notice alleging that the "lease holder has not furnished any documentary evidence in token of discrepancy of transported quantity of 81,029 MTS of silica sand lifted and transported and hence reply furnished by lessee is not considerable" and directed to pay an amount of Rs. 4,70,91,675/- as per Rules 26(1) and 34(1) of the Rules. (e) Challenging the said show cause notice, petitioner filed WP No. 12915 of 2019 and this Court disposed of the said writ petition on 08.11.2019 granting liberty to the petitioner to approach the authority by way of filing a revision under Rule 35 of the Rules and further directed the respondents not to take any coercive steps for a period of four weeks. (f) Pursuant to the said direction, petitioner filed a revision before the 1 respondent on 25.11.2019; in the grounds of revision, it is contended before the Revisional Authority that as per the production dispatch register, the total silica mined is 3,20,000 MT and the balance stock available on that day was 49,327 MT and that the 4 respondent has not deducted 10% as production wastage while mining and dispatching the material; as per the approved mining plan/mining scheme it is 32,000 MT and if the same is deducted, the variation would be 588 MT i.e., 0.18% and the variation of dispatch is -299 MT; it is also contended that the inspection was conducted in the absence of the petitioner and the period of nine years is a very long period and that there is no basis for issuance of demand notice; as the respondents were insisting for payment of amount, petitioner filed WP No. 1113 of 2020 and this Court disposed of the said writ petition on 22.01.2020, directing the 1 respondent to dispose of the stay application in the revision petition within a period of two weeks and further directed the respondents not to take any coercive steps. (g) The 1 respondent has called for the parawise remarks from the 2 respondent, who in turn called for the remarks from the 4 respondent and the remarks of the 4 respondent are extracted in the order passed by the 1 respondent on 21.07.2020. Challenging the same, the present writ petition is filed. 4. (g) The 1 respondent has called for the parawise remarks from the 2 respondent, who in turn called for the remarks from the 4 respondent and the remarks of the 4 respondent are extracted in the order passed by the 1 respondent on 21.07.2020. Challenging the same, the present writ petition is filed. 4. Sri O. Manoher Reddy, learned counsel for the petitioner, submits that the 1 respondent, while exercising the power of quasi-judicial authority under Rule 35(a) of the Rules, has passed non-speaking order without considering the contentions raised by the petitioner in the grounds of revision by merely extracting the parawise remarks submitted by the 4 respondent. He further submits that the authority while exercising quasi-judicial function must record reasons irrespective of whether the decision is subject to appeal, revision or judicial review. In support of his contention, he relied upon the decision of the Constitution Bench of the Hon'ble 1 Supreme Court in 'S.N. Mukherjee v. Union of India 1990(4) SCC 594 . He submits that without furnishing the information sought for by the petitioner, the 4 respondent has issued the demand notice. He further submits that 10% of the production has to be deducted towards wastage, but the same was not taken into consideration and that the stock available at the site was also not taken into consideration for arriving at the figure and if the same is taken into consideration, there is no variation in the stock. He also submits that even though such a contention has been raised, the 4 respondent has not disputed the same in the parawise remarks submitted by him. 5. Learned Government Pleader for Mines and Geology on the other hand, submits that the reply submitted by the petitioner to the show cause notice was not satisfactory and hence, the demand notice has been issued and that after granting a personal hearing to the petitioner on 24.06.2020 and after considering the grounds raised in the revision, the revision application of the petitioner was dismissed upholding the demand notice 21.08.2019 and that it needs no interference by this Court. 6. As seen from the impugned order dated 21.07.2020, as many as 20 grounds were raised by the petitioner in the revision application, which are extracted by the 1 respondent in the impugned order at para 2. The ground Nos. (vi), (vii) and (ix) to (vx) read as follows: "vi. 6. As seen from the impugned order dated 21.07.2020, as many as 20 grounds were raised by the petitioner in the revision application, which are extracted by the 1 respondent in the impugned order at para 2. The ground Nos. (vi), (vii) and (ix) to (vx) read as follows: "vi. Further, in the instant case, the 10% of production as wastage, while mining and dispatching the mineral as approved in Approved Mining Plan/Mining scheme is 32,000 MT. vii. The variation in production between the assessment of ADM and G (3,19,412 MT) and the lessee (3,20,000 MT) is - 588 MT which is about 0.18% and to be ignored. ix. On verification of the joint inspection report furnished by ADM and G Nellore, it is very clear that the inspection team measured the worked pits available in the mining leased area and assessed the quantity mined and did not take the measurements of stocks available in the mine and assessed the quantity of stock of silica sand in the mine. In the instant case the ADM and G, Nellore did not take into account the stock of Silica Sand (49,327 MT) available at mine head while assessing the differential quantity of Silica Sand between the production and dispatches. x. Further, in the instant case, the ADM and G, Nellore did not calculate and taken into account the 10% of production as wastage, (32,000 MT) while mining and dispatching the mineral as approved in approved mining plan/mining scheme. xi. The mined quantity of Silica sand must be equal to the dispatched quantity plus stock available at mine site plus 10% of production as wastage. xii. In the instant case, as per the lessee the mined quantity (3,20,000 MT) = quantity dispatched (2,38,678 MT) + stock at mine head (49,327 MT) + 10% of wastage (32,000 MT). xiii. In the instant case, the stock (49,327 MT) at mine site was not taken into account, and also the wastage of 10% of the production as per the approved mining plan, which resulted in the variation of 81,029 MT, as per the assessment of the ADM and G, Nellore. xiv. xiii. In the instant case, the stock (49,327 MT) at mine site was not taken into account, and also the wastage of 10% of the production as per the approved mining plan, which resulted in the variation of 81,029 MT, as per the assessment of the ADM and G, Nellore. xiv. Once the stock of silica sand (49,327 MT) and also the wastage of 10% (32,000 MT) is taken into account, the variation shall come to -588 MT, between the production as per the lessee and as assessed by the ADM and G by taking pit measurements, which is around 0.18% which is to be ignored. xv. The variation (81,029 MT) arrived by the ADM and G is due not taking into account the actual dispatches as per MRA, the stock available at Mines site as on the date of inspection and also 10% of production as wastage." 7. In para 3 of the impugned order, the 1 respondent extracted the remarks of the 4 respondent. Para 3 (iv), (v) and (vi) of the remarks of the 4 respondent read as follows: "(iv) In this connection, their office has issued show cause notice No. 1531/M/2005, dated 21.08.2019 to Sri B. Rajan to submit his explanation for the discrepancy of the quantity of 81,029 MTs arrived in between the excavated, transported quantity and permits issued quantity within fifteen (15) days from the date of receipt of this notice, duly instructing failed to comply in the matter, necessary action will be initiated as per rules in vogue. (v) On 08.08.2019, Sri B. Rajan has submitted his reply stating that, the mine was not inspected in the presence of the mine owner and also requested certain information like sketch showing the pits, their measurements and work sheets showing the volume and tonnage worked at and also whether the stock available at the mine head is taken into account or not? (vi) As seen from the reply submitted by the lessee, it is noticed that the lease holder has not furnished any documentary evidence in token of disparity in between the permitted quantity and lifted quantity of 81029 MT of Silica sand. (vi) As seen from the reply submitted by the lessee, it is noticed that the lease holder has not furnished any documentary evidence in token of disparity in between the permitted quantity and lifted quantity of 81029 MT of Silica sand. Hence, the reply furnished by the lessee not considered due to lack of merits and he is liable to pay the following amounts for the resorted illegal excavations and transportation of Silica sand for a quantity of 81,029 MT as per Rules 26(1) and 34(1) of APMMC Rules, 1966 within fifteen (15) days from the date of receipt of this notice failing which necessary action shall be initiated for collection of amounts under R.R. Act:- Quantity MT Seig. Fee Rs. Market Value Rs. Penalty Rs. Total Rs. 81029 6077175 40514500 500000 47091675 Paras (xiii) and (xiv) of the remarks of the 4 respondent read as follows: "xiii. In view of the contents narrated by the petitioner merely on the grounds that the mine is not inspected in the presence of mine owner, 10% production waste not taking into account and available stocks has not been taking into account etc. the reply submitted is not satisfactory." (xiv) In this connection it is submitted that, as per joint inspection report, the officials of the team did not recorded the stock available in the leased area. Further submit that as per Sections 24(1) (a) and (b) of MMDR Act, 1957 and amended Act, 2015 envisaged that, for ascertaining the position of workings etc., of any mine, the person or authorized by the Central or State Govts., may enter and inspect any mine, survey and can take measurements in any mine. Similarly Rule 26(3)(I)(a) and (b) APMMC, Rules, 1966 implies in respect of minor mineral like Silica sand etc. Hence, the officers are empowered to do the inspections alone and not necessary if any person related to lessee or lessee himself and also the inspections are conducted by the department on its own neither any complaint received nor any orders by any investigation agencies." 8. At para 4 of the impugned order, it is stated that the 4 respondents recommends for dismissal of the revision petition. 9. At para 5 of the impugned order, it is stated that personal hearing was conducted on 24.06.2020 giving reasonable opportunity to the petitioner herein. 10. At para 4 of the impugned order, it is stated that the 4 respondents recommends for dismissal of the revision petition. 9. At para 5 of the impugned order, it is stated that personal hearing was conducted on 24.06.2020 giving reasonable opportunity to the petitioner herein. 10. As seen from the impugned order, except extracting the grounds of the revision and parawise remarks of the 4 respondent, there is no discussion whatsoever in the impugned order as to why the contentions raised by the petitioner does not merit consideration. Even though the petitioner specifically pleaded in the grounds with regard to 10% production wastage, measuring of the stock which is available in the mine and inspection in his absence, there is no discussion at all except stating that the reply is not the satisfactory. Surprisingly in the parawise remarks submitted by the 4 respondent at para 3 (v) it is also stated that the petitioner has sought for some information including as to whether stock available at the mine head is taken into account or not and at para 3 (xiv) it is stated that as per the joint inspection report, the officials of the team did not record the stock available in the leased area, but there is no discussion in the impugned order as to why the stock available in the leased area is not taken into consideration. 11. In S.N. Mukherjee's case (1 supra), the Constitution Bench of the Hon'ble Supreme Court, at paras 38 and 39 held as follows: "38. The object underlying the rules of natural justice "is to prevent miscarriage of justice" and secure "fair play in action." As pointed out earlier the requirement about recording of reasons for its decision by an administrative authority exercising quasi-judicial functions achieves this object by excluding chances of arbitrariness and ensuring a degree of fairness in the process of decision-making. Keeping in view the expanding horizon of the principles of natural justice, we are of the opinion, that the requirement to record reason can be regarded as one of the principles of natural justice which govern exercise of power by administrative authorities. The rules of natural justice are not embodied rules. The extent of their application depends upon the particular statutory framework where under jurisdiction has been conferred on the administrative authority. The rules of natural justice are not embodied rules. The extent of their application depends upon the particular statutory framework where under jurisdiction has been conferred on the administrative authority. With regard to the exercise of a particular power by an administrative authority including exercise of judicial or quasi-judicial functions the legislature, while conferring the said power, may feel that it would not be in the larger public interest that the reasons for the order passed by the administrative authority be recorded in the order and be communicated to the aggrieved party and it may dispense with such a requirement. It may do so by making an express provision to that affect as those contained in the Administrative Procedure Act, 1946 of U.S.A. and the Administrative Decisions (Judicial Review) Act, 1977 of Australia whereby the orders passed by certain specified authorities are excluded from the ambit of the enactment. Such an exclusion can also arise by necessary implication from the nature of the subject-matter, the scheme and the provisions of the enactment. The public interest underlying such a provision would out-weight the salutary purpose served by the requirement to record the reasons. The said requirement cannot, therefore, be insisted upon in such a case. 39. For the reasons aforesaid, it must be concluded that except in cases where the requirement has been dispensed with expressly or by necessary implication, an administrative authority exercising judicial or quasi-judicial functions is required to record the reasons for its decision." Under Rule 35-A of the Rules, requirement of giving reasons is not expressly or by necessary implication dispensed with. 12. In 'Central Public Information Officer, Supreme Court of India v. Subhash Chandra Agarwal 2019(16) SCALE 40 ', while relying upon the S.N. Mukherjee's case (1 supra), the Constitution Bench of the Hon'ble Supreme Court held that 'the requirement to record reasons is a principle of natural justice and a check against the arbitrary exercise of power by judicial and quasi-judicial bodies.' 13. In 'Kranti Associates Pvt. Ltd. v. Masood Ahemd Khan (2010) 9 SCC 496.', the Hon'ble Supreme Court held as follows: "51. ...Summarizing the above discussion, this Court holds: (a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. (b) A quasi-judicial authority must record reasons in support of its conclusions. ...Summarizing the above discussion, this Court holds: (a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. (b) A quasi-judicial authority must record reasons in support of its conclusions. (c) Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well. (d) Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power. (e) Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations. (f) Reasons have virtually become as indispensable a component of a decision-making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies. (g) Reasons facilitate the process of judicial review by superior courts. (h) The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the lifeblood of judicial decision-making justifying the principle that reason is the soul of justice. (i) Judicial or even quasi-judicial opinions these days can be as different as the judges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants faith in the justice delivery system. (j) Insistence on reason is a requirement for both judicial accountability and transparency. (k) If a judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism. (l) Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or 'rubber-stamp reasons' is not to be equated with a valid decision-making process. (m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor (1987) 100 Harv L. Rev. (m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor (1987) 100 Harv L. Rev. 731-37.) (n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision-making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See Ruiz Torija v. Spain [(1994) 19 EHRR 553], EHRR at p. 562, para 29 and Anya v. University of Oxford 2001 EWCA Civ 405, wherein the Court referred to Article 6 of the European Convention of Human Rights which requires, 'adequate and intelligent reasons must be given for judicial decisions'. (o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of 'due process'." 14. This Court in 'Kalari Nagabhushana Rao v. the Collector, Panchayat Wing, Guntur' AIR 1978 AP 444 : 1987(2) ALT 217 , held as follows: "The very practice of calling for reports or para-wise remakes on the appeal memorandum by the statutory quasi-judicial appellate tribunal or authority unless specifically provided for in the statute or the rules framed thereunder, must be deprecated. Such a procedure is not only unjust and improper but would also prejudice to a great extent the case of the very person who had come to the appellate tribunal with a definite case that what has been done by the original authority was illegal incorrect and unjust. Such a practice may be therefore a number of years but it must be put an end to. The earlier such practices are given up, the better for the concerned parties and people at large. Proper and independent exercise of powers and functions by a statutory quasi-judicial appellate authority or tribunal is essential and necessary for the administration of justice." 15. The concept of natural justice has undergone a great deal of change in recent years. The earlier such practices are given up, the better for the concerned parties and people at large. Proper and independent exercise of powers and functions by a statutory quasi-judicial appellate authority or tribunal is essential and necessary for the administration of justice." 15. The concept of natural justice has undergone a great deal of change in recent years. In the past it was thought that it included just two rules namely (i) no one shall be a Judge in his own cause (nemo debet esse judex in propria causa) and (ii) no decision shall be given against a party without affording him a reasonable hearing (audi alteram partem). Very soon thereafter a third rule was envisaged and that is that quasi-judicial enquiries must be held in good faith, without bias and not arbitrarily or unreasonably. The requirement to record reason can be regarded as one of the principles of natural justice which govern exercise of power by administrative authorities. The extent of their application depends upon the particular statutory framework where under jurisdiction has been conferred on the administrative authority. Except in cases where the requirement has been dispensed with expressly or by necessary implication, an administrative authority exercising judicial or quasi-judicial functions is required to record the reasons for its decision. Recording of reasons excludes chances of arbitrariness and ensures a degree of fairness in the process of decision making. The extent and nature of the reasons would depend on particular facts and circumstances. The reasons should be clear and explicit so as to indicate that the authority has given due consideration to the issues raised by the party or points in controversy. 16. In similar fact situation, where reasons are not given in the impugned order, this Court in W.P. No. 12923 of 2020 dated 31.07.2020, allowed the writ petition setting aside the impugned order therein, confirming the demand notice and remitted back the matter for passing appropriate orders. 17. In the impugned order there is no discussion at all with regard to the grounds raised in the revision application and reasons are not given as to why the revision application is dismissed, which is contrary to the above discussed judgments of the Hon'ble Supreme Court. 18. 17. In the impugned order there is no discussion at all with regard to the grounds raised in the revision application and reasons are not given as to why the revision application is dismissed, which is contrary to the above discussed judgments of the Hon'ble Supreme Court. 18. In view of the facts and circumstances of the case and for the reasons recorded above, the impugned order dated 21.07.2020 is set aside and the matter is remitted back to the 1 respondent for passing appropriate orders after giving opportunity of hearing to the petitioner. There was an interim order passed by this Court in the previous W.P. No. 1113 of 2020 filed by the petitioner, directing the respondents not to take coercive steps. In view of the same, pending consideration of the revision application by the 1 respondent, no coercive steps shall be taken against the petitioner pursuant to the demand notice dated 21.08.2019. 19. The writ petition is, accordingly, allowed. No order as to costs. Miscellaneous Petitions pending, if any, shall stand closed in consequence.