ORDER : K. LAKSHMAN, J. Heard Mr. Kondaveeti Ravi, learned Senior Counsel representing Mr. Kirthi Teja, learned counsel for the petitioner, Mr. Mohd. Imran Khan, learned Additional Advocate General appearing on behalf of the respondents. 2. CASE OF THE PETITIONER i) The petitioner herein has obtained quarry lease for stone and metal over an extent of Acs.7.20 guntas in Survey No.50, situated at Allampally Village, Vikarabad Mandal, Vikarabad District, for a period of fifteen (15) years vide proceedings dated 24.08.2018. The lease deed was also executed on the same day on the specific terms and conditions mentioned therein. ii) Pursuant to the said lease deed, the petitioner had entered into a Memorandum of Understanding (MOU) with Mr. L.Sudarshan Reddy, a Government Contractor for supply of mineral for utilization of the same in Government works. As per G.O.Ms.No.94, Irrigation & CAD Department, dated 01.07.2003, seigniorage charges will be recovered from the contractor’s bill for the material used for the Government work and will be directly paid into the Government account. For the mineral excavated and supplied to the said Contractor, seigniorage charges to an extent of Rs.1,83,02,766/- were recovered from the bills paid to the petitioner and were directly remitted to the Revenue Head of Account of Mines and Geology Department during the period from 2017-18 to 2024-25. iii) The Regional Vigilance and Enforcement Officer, Hyderabad along with Technical Staff inspected the working lease area of the petitioner on 07.02.2024 and 09.02.2024 respectively. A report was submitted to respondent No.4. Basing on the said report, respondent No.4 has issued a show-cause notice dated 03.06.2024 stating that the petitioner has excavated and transported mineral more than the permitted quantity of 295645MT. Therefore, respondent No.4 sought to realize normal seigniorage fee of Rs.1,92,16,925/- and five times penalty of Rs.9,60,84,625/- and permit fee of Rs.1,53,73,540/-, DMFT of Rs.57,65,078/-, SMET of Rs.3,84,339/- and I.T. of Rs.3,84,339/-, making a total of Rs.13,72,08,846/-. iv) It is also alleged in the said show-cause notice that the actual excavated quantity as per the calculation was arrived at 3,13,095MT, however, permits were obtained only for 17,450MT. Thus, according to respondent No.4, the petitioner transported excess quantity of 2,95,645MT. Fifteen (15) days time was granted to the petitioner to submit explanation. v) It is the specific contention of the petitioner herein that it has received the said show-cause notice dated 03.06.2024 only on 12.07.2024. Thus, according to respondent No.4, the petitioner transported excess quantity of 2,95,645MT. Fifteen (15) days time was granted to the petitioner to submit explanation. v) It is the specific contention of the petitioner herein that it has received the said show-cause notice dated 03.06.2024 only on 12.07.2024. It has submitted explanation on 29.07.2024, but the same was received by respondent No.4 on 08.08.2024. It is also specifically contended by the petitioner that despite making an attempt by the petitioner to serve the said explanation personally, respondent No.4 has received the same only on 08.08.2024. Without considering the said explanation, respondent No.4 has issued demand notice dated 30.07.2024 directing the petitioner to remit the aforesaid amounts. vi) It is also the specific contention of the petitioner that after receipt of the explanation dated 08.08.2024, respondent No.4 has issued a demand notice dated 30.07.2024 i.e., back-dated. Therefore, the impugned demand notice is not on consideration of the explanation dated 08.08.2024 and it is in violation of principles of natural justice. vii) The mineral which has been excavated has been utilized for Government work and as per G.O.Ms.No.94, dated 01.07.2003, seigniorage fee would be recovered from the contractor’s bill and would be remitted to the head of account of the concerned department. An amount of Rs.1,83,02,766/- was recovered towards seigniorage fee and remitted to the Head of Account of Mines and Minerals Department for the years from 2017-18 to 2024-25. The same was not considered by respondent No.4 in the impugned demand notice. viii) Vide order dated 30.09.2022 in W.P.No.8390 of 2018 and batch, High Court of Andhra Pradesh held that respondent No.4 or any other Authority of the State cannot determine the culpability of the person said to be in violation of the MDR Act or the Concession Rules or levy a penalty and it is only a Court of competent jurisdiction which can go into these questions and levy penalties set out under Rule - 26 of the Telangana State Minor Mineral Concession Rules, 1966 (for short ‘Concession Rules’) or under any of the other provisions of the MMDR Act or the Concession Rules. Therefore, respondent No.4 has no jurisdiction to issue demand notice dated 30.07.2024. 3. Therefore, respondent No.4 has no jurisdiction to issue demand notice dated 30.07.2024. 3. CONTENTION OF THE RESPONDENTS: i) Respondent No.4 has filed counter contending that as per the guidelines of respondent No.2, the DGPS Survey of the quarry lease was conducted by the Empanelled Agency, M/s. Rehoboth Surveys, Hyderabad in the presence of the Surveyor of Mines Department and lease holder. Basing on the said report, respondent No.4 has issued the show-cause notice dated 03.06.2024 demanding an amount of Rs.1,92,16,925/- towards seigniorage fee and five times penalty etc. The said notice was sent to the petitioner through registered post with acknowledgment due. The same was returned un-served with an endorsement ‘door locked’. The said postal cover returned to respondent No.4 on 12.07.2024. Therefore, respondent No.4 served the said show-cause notice dated 03.06.2024 on the petitioner through Special Messenger on 12.07.2024. Despite granting fifteen (15) days time from the date of receipt of said notice, the petitioner failed to submit any explanation. Therefore, respondent No.4 has issued demand notice to the petitioner directing it to pay an amount of Rs.13,72,08,846/- under various heads. The said notice was also returned un-served with an endorsement ‘door locked’ on 09.08.2024. After receipt of the demand notice, the petitioner submitted reply on 08.08.2024 by putting back-date as 30.07.2024. ii) Therefore, the petitioner cannot contend that the demand notice is without consideration of explanation dated 08.08.2024. However, respondent No.4 has served the said demand notice on the petitioner on 12.09.2024 by way of Special Messenger. There is no error in the said demand notice. iii) With the aforesaid submissions, respondent No.4 sought to dismiss the present writ petition. 4. The petitioner filed reply affidavit adverting to the aforesaid contentions of respondent No.4. 5. ANALYSIS AND FINDINGS OF THE COURT i) The aforesaid rival submissions would reveal that the petitioner herein has obtained quarry lease for stone and metal over an extent of Acs.7.20 guntas in Survey No.50 of Allampally Village, Vikarabad Mandal and District, for a period of fifteen (15) years on 24.08.2018 and a lease deed was executed on the same day. It is the specific contention of the petitioner that it has entered into MOU with Mr. L. Sudarshan Reddy, Government Contractor for supply of mineral for utilization of the same in Government works. It is the specific contention of the petitioner that it has entered into MOU with Mr. L. Sudarshan Reddy, Government Contractor for supply of mineral for utilization of the same in Government works. Seigniorage charges will be recovered from the contractor’s bill as per G.O.Ms.No.94, dated 01.07.2003 for the material used for the government work and will be directly paid into the Government Account. According to it, an amount of Rs.1,83,02,766/- was recovered from the bills payable to the petitioner towards seigniorage during the period from 2017-18 to 2024-25. ii) It is also not in dispute that the Regional Vigilance & Enforcement Officer, Hyderabad, along with technical staff has inspected the working lease area of the petitioner on 07.02.2024 and 09.02.2024. A report was submitted to respondent No.4. Basing on the said report, respondent No.4 has issued show-cause notice dated 03.06.2024 demanding an amount of Rs.13,72,08,846/- on the ground that the petitioner has excavated and transported quantities of more than permitted limit of 2,95,645MT in violation of Rule - 26 (3) (ii) of the Concessions Rules. iii) It is the specific contention of the petitioner that it has received the said show-cause notice only on 12.07.2024. When the petitioner tried to submit explanation in person on 29.07.2024, respondent No.4 office failed to receive it. With great difficulty, it has submitted explanation on 08.08.2024 and the office of respondent No.4 received and acknowledged the same on 08.08.2024. Without considering the same, respondent No.4 has issued demand notice dated 30.07.2024 by putting back-date. iv) It is also the specific contention of the petitioner that in respect of work lease of the petitioner, the respondent authorities have not followed scientific method in measuring the working lease area from which mineral was excavated and measurements were taken without following the prescribed procedure. The measurement was done in terms of cubic meters (volume) and later it was converted into tones (weight). Measurements were taken in terms of cubic meters (volume) as it is not possible to weigh large quantity of mineral. v) It is also the specific contention of the petitioner that while converting mineral from cubic meters (volume) into metric tones (weight), the cubic meters shall be multiplied with 1.5. The respondents have multiplied the cubic meters (volume) with 2.64 specific gravity factor to arrive metric tones (weight). v) It is also the specific contention of the petitioner that while converting mineral from cubic meters (volume) into metric tones (weight), the cubic meters shall be multiplied with 1.5. The respondents have multiplied the cubic meters (volume) with 2.64 specific gravity factor to arrive metric tones (weight). The value of the mineral in terms of metric tones was treated as Rs.65/- per metric tone on the quantity from 2018 onwards. The rate of Rs.65/- was not there from the year 2018. The rate was Rs.50/- per metric ton up to 2022. Thus, calculating Rs.65/- per metric ton from 2018 and imposing penalty is contrary to the GOs issued by the respondents. Respondents multiplied with higher multiplier of 2.64 instead of 1.5. Therefore, the same is also contrary to the GOs. vi) While issuing the impugned demand notice demanding huge amount of Rs.13.00 Crores and odd, the respondents have to strictly follow the procedure laid down under law and the Circulars issued by them. It is also the specific contention of the petitioner that vide Circular dated 23.02.2019 of respondent No.2, it was reiterated that the specific gravity of 2.64 shall not be applied for the loose boulders derived after blasting the insitu rock, as it will lead to permitting excess quantity of mineral in terms of volume and cause evasion of seigniorage fee from raw material to finished product. Thus, the conversion factor of 1:1:5 from volume to tonnage specified as per Rule - 10 of the Concessions Rules is based on weightage only, but not on specific gravity of the material. vii) As per G.O.Ms.No.18, Industries & Commerce (Mines-II) Department, dated 31.03.2022, the rate of seigniorage fee was revised by amending the Concession Rules. As per the said G.O., the rate of seigniorage fee was fixed at Rs.65/- per metric ton for building stone, rough stone/boulders, road metal, ballast and manufactured sand. Prior to 31.03.2022, the rate of seigniorage fee was Rs.65/- per metric ton. viii) As per G.O.Ms.94, Irrigation & CAD (PW-COD) Department, dated 01.07.2003, the seigniorage charges will be recovered from the contractor’s bills. ix) Though the respondents are placing reliance on the Memo, dated 05.07.2017 i.e., operational guidelines for conduct of DGPS/ETS Survey, they have not filed copy of the same. Thus, according to the petitioner, the respondents have not followed the aforesaid Memos/Circulars and not calculated the seigniorage fee properly. ix) Though the respondents are placing reliance on the Memo, dated 05.07.2017 i.e., operational guidelines for conduct of DGPS/ETS Survey, they have not filed copy of the same. Thus, according to the petitioner, the respondents have not followed the aforesaid Memos/Circulars and not calculated the seigniorage fee properly. x) As discussed above, vide impugned demand notice dated 30.07.2024, respondent No.4 requested the petitioner to pay an amount of Rs.13,72,08,846/- under various heads within fifteen (15) days. It is the specific contention of the petitioner that the show-cause notice dated 03.06.2024 was served on the petitioner only on 12.07.2024. When the petitioner tried to submit explanation in person, respondent No.4 office failed to receive it. With great difficulty, the petitioner has served the said reply in the office of respondent No.4 only on 08.08.2024. When respondent No.4’s office failed to receive explanation and give acknowledgment in proof of receipt of the same, the petitioner should have sent explanation through registered post with acknowledgment due. Instead, the petitioner is claiming that despite making efforts to submit explanation in the office of respondent No.4 in person, they have not received and that they have received only on 08.08.2024. The said contention of the petitioner is not believable. However, respondent No.4 has received the explanation on 08.08.2024. xi) It is also relevant to note that even according to respondent No.4, the show-cause notice dated 03.06.2024 sent to the petitioner was returned un-served by the Postal Authorities only on 12.07.2024 with an endorsement ‘door locked’. There is specific assertion to the said effect in paragraph No.13 of the counter affidavit. Respondent No.4 has filed copy of the said returned postal cover. Perusal of the same would reveal that the same was posted on 13.06.2024 and according to respondent No.4, it was returned on 12.07.2024. Therefore, they have served the said show-cause notice on the petitioner on 12.07.2024 through a Special Messenger, Mr. Mohd. Riyazuddin, Junior Assistant. Thus, even according to respondent No.4, the said notice was served on the petitioner only on 12.07.2024. Fifteen (15) days time to submit explanation was expired on 27.07.2024. Even then, the petitioner did not submit explanation to the same. It has submitted explanation only on 08.08.2024. Mohd. Riyazuddin, Junior Assistant. Thus, even according to respondent No.4, the said notice was served on the petitioner only on 12.07.2024. Fifteen (15) days time to submit explanation was expired on 27.07.2024. Even then, the petitioner did not submit explanation to the same. It has submitted explanation only on 08.08.2024. xii) According to respondent No.4, it has issued demand notice to the petitioner dated 30.07.2024 and the same was sent to the petitioner through registered post with acknowledgment due and the same was also returned un-served by the Postal Authorities with an endorsement ‘door locked’ on 09.08.2024. Respondent No.4 has filed copy of the said returned postal cover. Perusal of the same would reveal that the same was posted only on 06.08.2024. Even according to respondent No.4, it was returned on 09.08.2024 with an endorsement ‘door locked’. The petitioner has submitted explanation to respondent No.4 on 08.08.2024 itself. xiii) As discussed above, it is the specific contention of the petitioner that the respondents have not calculated the seigniorage fee properly. It has also placed reliance on G.O.Ms.No.94, dated 01.07.2003 and G.O.Ms.No.243, dated 08.05.1996. It is also the specific case of the petitioner that it has entered into MOU with Mr. L. Sudarshan Reddy, Government Contractor, for supply of mineral for utilization of the same in Government works. As per G.O.Ms.No.94, dated 01.07.2003, the respondent authorities have already recovered an amount of Rs.1,83,02,766/- during the period from 2017-18 to 2024-25. It has also filed bills to the said effect. xiv) It is also relevant to note that according to the petitioner, vide Memo dated 23.02.2019, the Government has issued instructions for computation of raw material and finished mineral dispatched against permits obtained to arrive at evaded seigniorage fee through revision of MRAs. In the said memo, it is reiterated that the specific gravity of 2.64 shall not be applied for the loose boulders derived after blasting the insitu rock, as it will lead to permitting excess quantity of mineral in terms of volume and cause evasion of seigniorage fee from raw material to finished product. The conversion factor of 1:1:5 from volume to tonnage specified as per Rule 10 of TSMMC Rules, 1966 is based on weightage only but not on specific gravity of the material. Vide G.O.Ms.No.18, dated 31.03.2022, the Government has revised the seigniorage fee. The conversion factor of 1:1:5 from volume to tonnage specified as per Rule 10 of TSMMC Rules, 1966 is based on weightage only but not on specific gravity of the material. Vide G.O.Ms.No.18, dated 31.03.2022, the Government has revised the seigniorage fee. The said aspects were not considered by respondent No.4 while issuing show-cause notice and impugned demand notice. xv) As rightly contended by learned Senior Counsel for the petitioner that respondent No.4 demanded huge money of Rs.13,72,08,846/- under various heads. Respondent No.4 should have served notice on the petitioner properly and on receipt of explanation, should have considered the aforesaid aspects while issuing demand notice. Respondent No.4 did not follow the said procedure. Thus, there is violation of principles of natural justice in issuing impugned demand notice dated 30.07.2024. Therefore, this Court cannot dismiss the writ petition and relegate the petitioner to approach the Appellate/Regional Vigilance & Enforcement Officer, Hyderabad, under Rules - 35 and 35A of the Concessions Rules. xvi) Mr. Kondaveeti Ravi, learned Senior Counsel appearing for the petitioner placed reliance on the principle laid down by the Hon’ble Supreme Court in State of U.P. v. Maharaja Dharmander Prasad Singh etc. , [ AIR 1989 SC 997 ] to contend that respondent No.4 being the quasi- judicial officer has to exercise the same strictly in accordance with law by following principles of natural justice. As discussed above, there is violation of procedure laid under the aforesaid Circulars and G.Os. by respondent No.4 apart from violation of principles of natural justice. xvii) Learned Senior Counsel appearing for the petitioner also placed reliance on the principle laid down by the High Court of Andhra Pradesh in M/s. GSR Stone Crushers v. The State of A.P. , W.P. No.8390 of 2022 & batch, decided on 30.09.2022 to contend that respondent No.4 has no power to issue impugned demand notice. xviii) Whereas, learned Additional Advocate General, on instructions, would submit that the State has already preferred Intra- Court Appeals challenging the common order passed by High Court of Andhra Pradesh in M/s. GSR Stone Crushers and a Division Bench of High Court of Andhra Pradesh reserved the matter. 6. CONCLUSION i) Therefore, without expressing any opinion on merits of the case, only on the ground of violation of principles of natural justice, the said impugned demand notice dated 30.07.2024 of respondent No.4 is set aside. 6. CONCLUSION i) Therefore, without expressing any opinion on merits of the case, only on the ground of violation of principles of natural justice, the said impugned demand notice dated 30.07.2024 of respondent No.4 is set aside. The matter is remanded to respondent No.4 with a direction to pass orders afresh strictly in accordance with law by considering the aforesaid Memos, G.Os etc., and contentions raised by the petitioner. Liberty is granted to the petitioner to submit additional information/explanation including documents and respondent No.4 shall consider the same. Liberty is also granted to the petitioner to raise all the contentions and grounds which it has raised in the present writ petition including jurisdiction of respondent No.4, and it is for respondent No.4 to consider the same. However, respondent No.4 shall complete the entire exercise within four (04) weeks from the date of receipt of copy of this order. The petitioner shall co-operate with respondent No.4 in concluding the aforesaid exercise. ii) This writ petition is accordingly disposed of. In the circumstances of the case, there shall be no order as to costs.