THE HON’BLE SRI JUSTICE SANJAY KUMAR WRIT PETITION NO.18600 OF 2010 DATED 2ND AUGUST, 2010 BETWEEN M/s.Transworld Garnet India Private Limited, Having its Project Office at # 14-9-136/2A, Dhandi Street, C.B.Road, Srikakulam – 532 001, Represented by its General Manager Sri K.P.Reddy, S/o Late Sri K.V.Reddy, aged about 55 years, R/o Srikakulam. … Petitioner And The Government of Andhra Pradesh, Represented by its Secretary, Department of Industries and Commerce, Andhra Pradesh State Secretariat, Hyderabad – 500 022. And Others. … Respondents THE HON’BLE SRI JUSTICE SANJAY KUMAR WRIT PETITION NO.18600 OF 2010 ORDER: The grievance of the petitioner company is with regard to the order passed by the Director of Mines and Geology, Hyderabad, dated 23.07.2010 refusing to issue permits for disposal of tailings containing prescribed substances on the ground that the petitioner company’s mining lease does not include the associated minerals which are found in such tailings. The petitioner company was granted a mining lease for thirty years in respect of garnet, a major mineral, under G.O.Ms.No.7, Industries and Commercial (M.III) Department, dated 05.01.2002. The relevant paragraphs of the G.O. may be extracted: “I) If, while mining garnet, the lessee comes across deposits of any prescribed substances/atomic minerals, the same shall be disposed of only after obtaining a licence from the Department of Atomic Energy (DAE) as required under the Atomic Energy (Working of Mines, Minerals and Handling of Prescribed Substances) Rules, 1984. II) The tailings containing the prescribed substances shall be disposed of only to another entity which holds a valid licence under the aforesaid Rules, to process/ separate the prescribed substances.” In accordance with the aforestated provisions, the petitioner company applied for permits to dispose of the accumulated tailings stocked on its premises. This evoked the response of the Department vide the order impugned. It is the case of the petitioner that as per the terms of the mining lease and the aforestated G.O., it was permitted to dispose of the tailings to an entity which holds a valid licence under the Atomic Energy (Working of Mines, Minerals and Handling of Prescribed Substances) Rules, 1984 (for brevity, ‘the Rules of 1984’). It therefore challenges the requirement now insisted upon that the associated minerals found in garnet tailings should be included in its mining lease. The learned Government Pleader for Industries and Commerce stated that pursuant to the mining lease entered into by and between the State and the petitioner company, the petitioner company being the lessee is bound by certain obligations. He placed reliance on clause 5(ii) of the Mining Lease which reads as under: “5. The lessee shall be free to undertake mining operations also in respect of the atomic minerals, the area held by him on the conditions that:- i) ………….. ii) that the qualities (quantities, sic) of atomic minerals recovered incidental to such mining operations shall be collected and stocked separately and a report to that effect sent to the Director, Atomic Minerals Division, New Delhi every three months, who will have samples thereof taken and analysed to determine whether they are of acceptable grade for purchase by the Department of Atomic Energy.” He also drew the attention of the Court to Rule 66-A of the Mineral Concession Rules, 1960. It is relevant to note that Rule 66-A of said the Rules was amended in the year 2005 whereas the subject lease dates back to the year 2002. Be that as it may, the fact remains that the State made sufficient provision to safeguard the atomic minerals that are generated in the process of mining garnet. Clause-I of the G.O.Ms.No.7 dated 05.01.2002 requires that the lessee should dispose of atomic minerals or prescribed substances only after obtaining a licence from the Department of Atomic Energy under the Rules of 1984. It is only tailings which contain prescribed substances that are permitted to be disposed of under clause-II of the aforestated G.O. to another entity which holds a valid licence under the Rules of 1984. Further, the conditions of the mining lease referred to by the learned Government Pleader make it clear that any atomic minerals recovered incidentally in the mining operations are to be offered in the first instance to the Department of Atomic Energy, which is given a pre-emptive right to purchase the same if such minerals are found to be of acceptable grade. These clauses are binding upon the petitioner company. In accordance with these clauses, the petitioner company is entitled to dispose of the tailings containing prescribed substances to an entity which is licensed. The mining authorities cannot insist that the petitioner company’s mining lease shall also include these minerals as a condition precedent to permit it to dispose of the same. As long as the petitioner company complies with the provisions of G.O.Ms.No.7 dated 05.01.2002 and the mining lease, the mining authorities cannot object to the disposal of the tailings by the petitioner company. The order dated 23.07.2010 passed by the Assistant Director of Mines and Geology, Srikakulam, is accordingly set aside. The respondents are directed to permit the petitioner company to dispose of the tailings with prescribed substances and the deposits, if any, of prescribed substances and atomic minerals in accordance with the terms of the G.O. aforestated and the mining lease, extracted hereinbefore. The Writ Petition is accordingly allowed to the extent indicated above. No costs. ____________________ SANJAY KUMAR, J. 2ND AUGUST, 2010 PGS/VGSR