*THE HON’BLE MR. JUSTICE C.V.NAGARJUNA REDDY +WRIT PETITION Nos.771 and 1996 of 2001 % 30-9-2008 +Writ Petition No.771 of 2001: # M/s.Sireesa Geo Granites, reptd., by its Quarry Manager-B.N.Reddy, s/o.RosyReddy, 38 yrs, Karimnagar District. … Petitioner Vs. $ The Government of Andhra Pradesh, reptd., by its Secretary, Industries and Commerce Department, Secretariat, Hyderabad and three others. … Respondents ! Counsel for the petitioners: Smt.N.Shoba ^ Counsel for the respondents: G.P. for Industries for R.1 to R.3. Sri K.Pratap Reddy, Senior Counsel for Sri V.Rajagopal Reddy, counsel for R.4. < Gist: > Head Note: ? Cases referred: 1) 1998 (3) ALD 519 2) 1995 (3) ALD 343 3) AIR 1991 AP 167 4) 1995 Supp. (4) SCC 224 5) 1999 (6) SCALE 557 IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) PRESENT: THE HON’BLE MR. JUSTICE C.V.NAGARJUNA REDDY TUESDAY, THE THIRTIETH DAY OF SEPTEMBER, TWO THOUSAND EIGHT ONLY WRIT PETITION Nos.771 and 1996 of 2001 Writ Petition No.771 of 2001: Between: M/s.Sireesa Geo Granites, reptd., by its Quarry Manager-B.N.Reddy, s/o.RosyReddy, 38 yrs, Karimnagar District. … Petitioner And The Government of Andhra Pradesh, reptd., by its Secretary, Industries and Commerce Department, Secretariat, Hyderabad and three others. … Respondents Counsel for the petitioners: Smt.N.Shoba Counsel for the respondents: G.P. for Industries for R.1 to R.3. Sri K.Pratap Reddy, Senior Counsel for Sri V.Rajagopal Reddy, counsel for R.4. Writ Petition No.1996 of 2001: Between: Pradeep Enterprises, reptd., by its Managing Partner- B.Laxma Reddy, s/o.Rosi Reddy, 35 yrs, Karimnagar. … Petitioner And The Government of Andhra Pradesh, reptd., by its Secretary, Industries and Commerce Department, Secretariat, Hyderabad and four others. … Respondents Counsel for the petitioners: Sri T.Jagdish. Counsel for the respondents: G.P. for Industries for R.1 to R.3. Sri K.Pratap Reddy, Senior Counsel for Sri V.Rajagopal Reddy, counsel for R.4. Smt.N.Shoba for R.5. This Court made the following: COMMON JUDGMENT: As common issues are involved in these two Writ Petitions, they are heard and being disposed of together. Writ Petition No.771 of 2001 is ﬁled for a Writ of Mandamus to declare order dated 11-12- 2000 passed by respondent No.1 rejecting the petitioner’s application dated 12-8-1999 granting mining lease to respondent No.4 over an extent of 1.44 Hectares in Survey No.168 of Odayaram village, Gangadhara Mandal, Karimnagar District as illegal. The petitioner also questioned the consequential order dated 12-1-2001 passed by respondent No.2 and prayed for setting aside both the orders. Writ Petition No.1996 of 2001 is ﬁled for identical reliefs against the proceedings of respondent Nos.1 and 2. Facts in Writ Petition No.771 of 2001: The petitioner was granted quarry lease of Grey Granite over an extent of 5 Hectares in Survey No.168 of Odayaram village, Gangadhar Mandal, Karinmanagar District, vide proceedings No.1076/Q.2/89 dated 9-6-1989 of respondent No.2. After the expiry of initial lease period of ﬁve years, it was renewed for another period of ﬁfteen years by respondent No.2 in his proceedings dated 22-8-1994. A lease deed to that eﬀect was entered into on 11-10-1994. Respondent No.2 granted similar quarry lease in favour of respondent No.4 over an extent of 1.17 Hectares in the same survey number on 11-12- 2000 and it executed a quarry lease and a work order on 15-1-2001; in pursuance of which it commenced mining operations. In the year 1994 respondent No.4 approached the Mines Department to get the survey conducted and ﬁx up boundaries on the ground that the petitioner and some other lessees operating their respective quarries in the same survey number are in occupation of excess areas over and above the areas for which they were granted mining leases. The survey so conducted revealed that while the petitioner and K.S.R. Granites were in occupation of 1.33 Hectares and 0.13 Hectares respectively in excess of the area granted to them, there is a short fall by 0.20 Hectares and 0.11 Hectares in area occupied by M/s.Swetha Granites and respondent No.4 respectively. Respondent No.2 issued show-cause notice dated 22-3-1999, wherein it was mentioned that a joint inspection was conducted from 17-1-1999 to 20-1-1999 followed by discussions held on 8-3- 1999 and as against the extent of 5.00 Hectares for which mining lease was granted to the petitioner, it was found in possession of 6.00 Hectares and that it was decided to delete the excess area on the northern side. The petitioner was, therefore, called upon to show cause why action in that regard should not be taken. The petitioner ﬁled its explanation, wherein it has, inter alia, stated that the petitioner developed the entire area in general and northern portion of the demarcated area in particular, as shown in the sketch, by investing huge amounts of money; that the petitioner is ready to pay the excess dead rent/ seignorage fees for the excess area; and that if northern portion of the demarcated area is taken away from it, it will be put to irreparable loss. It is also mentioned that the petitioner being the ﬁrst lease holder, it applied for the entire area and it will be put to grave injustice if the excess area is deleted from its leased area; and that in case it is inevitable to surrender the excess area, the petitioner may be permitted to surrender the portion of the area not developed by it. The petitioner also sent representation dated 22-4-2000 to the Honourable Minister for Mines and Geology, wherein he stated that the Department unilaterally deleted 1.00 Hectare of land on the northern side of the Hillock without even intimation to it; that there is a buﬀer area of 1.00 Hectare with 20 meters width on one side; that on one side the petitioner was operating the area and on the other side respondent No.4 and M/s.Swetha Granites are operating; and that if buﬀer area is allotted to other party, it will cause risk to the lives of the personnel on the petitioner’s side. The petitioner requested the Honourable Minister to grant the deleted portion of 1.00 Hectare to it, which was in its possession since 1989, to avoid litigation among the lessees. The petitioner further requested to order for maintenance of status quo in the buﬀer area. Respondent No.1 passed a comprehensive order on 11-12-2000 whereby it ordered for deletion of 1.33 Hectares of excess area from the petitioner’s possession as per the sketch prepared by respondent No.2 and added 0.11 Hectares of short fall area to respondent No.4. Respondent No.1 also considered the petitioner’s application dated 12-8-1999 for grant of lease in respect of gap/buﬀer area available in between the existing leasehold areas and granted lease in respect of 0.54 Hectares as against 1.00 Hectare, which it applied for. As regards respondent No.4, its application dated 2-8-1999 for lease of 1.00 Hectare, out of gap areas, was rejected as the same was found overlapping with the application of its sister concern-M/s.Pradeep Minerals and Granites Private Limited. For the said Pradeep Minerals and Granites, which made as many as three applications dated 15-5-1995, 15-5-1995 and 12- 12-1995 respectively for grant of lease for gap areas, respondent No.1 granted 0.27, 0.42 and 0.17 Hectares respectively, totalling 0.86 Hectares. In addition to this, respondent No.4 was granted 1.33 Hectares from out of the excess area occupied by the petitioner. The petitioner’s application dated 12-8-1999 for granting 1.00 Hectare, out of the excess area in its occupation, was rejected. Facts in Writ Petition No.1996 of 2001: The petitioner ﬁled an application for grant of prospecting license for granite over an extent of 1.50 Hectares in the same survey number on 23-12-2000. According to the petitioner, respondent No.4, who made its applications on 2-8-1999 and 9-8-1999, ought not to have been granted quarry lease as, by that time, the area has not fallen vacant and the same was premature. The petitioner averred that it made application on 23-12-2000, which stands ﬁrst in priority after the area fell vacant and it has questioned order dated 11-12-2000 of respondent No.1 by which respondent No.4 was granted mining lease. Smt.N.Shoba, learned counsel for the petitioner in Writ Petition No.771 of 2001, made the following submissions: (1) The order passed by respondent No.1 is without jurisdiction inasmuch as respondent No.2 is the competent authority to pass the order and having issued show cause notice, he alone ought to have considered the petitioner’s application and passed appropriate order; (2) The order passed by respondent No.1 is in violation of principles of natural justice as no opportunity of hearing was aﬀorded to the petitioner; (3) Unilateral deletion of the excess area from the petitioner’s leased area is arbitrary and illegal; and (4) Even if the excess area from the petitioner’s possession was deleted, grant of fresh lease to respondent No.4 is contrary to the judgment of this Court in Pradeep Minerals & Granites (P) Ltd. Vs. State of A.P. and others[1]. Sri T.Jagdish, learned counsel for the petitioner in Writ Petition No.1996 of 2001, supplemented the argument of Smt.N.Shoba and submitted that entertaining the application of respondent No.4 for grant of lease of excess area even before the same was available for grant and without following the mandatory procedure as per the ratio laid down in Pradeep Minerals & Granites (P) Ltd. (1 supra), is illegal and that, therefore, the lease of 1.33 Hectares granted to respondent No.4 is liable to be set aside. Opposing the contentions of the learned counsel for the petitioners, Sri K.Pratap Reddy, learned Senior Counsel, appearing for respondent No.4, and the learned Government Pleader for Industries, appearing for respondents 1 to 3, in both the Writ Petitions, submitted that the petitioner in Writ Petition No.771 of 2001 itself invoked the revisional jurisdiction of respondent No.1 under Rule 35-A of the A.P. Minor Mineral Concession Rules, 1966 (for short “the Rules”). They further submitted that the area granted to respondent No.4 having been in excess of the lease granted in favour of the petitioner in Writ Petition No.771 of 2001, it was available for grant when respondent No.4 and the petitioner in Writ Petition 771 of 2001 made their applications on 9-8-1999 and 12-8- 1999 respectively, and that, therefore, there was no illegality in the grant made in favour of respondent No.4. Both the learned counsel submitted that having due regard to the petitioner’s representation that northern area in possession of the petitioner was fully developed, respondent No.1 directed deletion of excess area from the petitioner’s possession on Southern side, and that, therefore, the said decision did not suffer from any illegality or arbitrariness. Points:- From the respective submissions of the learned counsel for the parties, the following points arise for consideration: (1) Whether the impugned order passed by respondent No.1 was without jurisdiction? (2) Whether the order passed by respondent No.1, deleting the excess area on the Southern side of the petitioner’s leased area was arbitrary and in violation of principles of natural justice? and (3) Whether grant of lease for 1.33 Hectares in favour of respondent No.4 is accordance with law? Re-Point No.1: After the survey of leasehold areas in Survey No.168 was held, respondent No.2 issued a show-cause notice on 22-3-1999. The petitioner ﬁled its explanation on 28-3-1999 to respondent No.2. It also made an application on 12-8-1999 for grant of prospecting lease for 1.00 Hectare of excess area, which was already in its possession. A few months thereafter, the petitioner made representation dated 22-4-2000 to the Honourable Minister for Mines and Geology, wherein while referring to the show- cause notice and explanation oﬀered by it, the petitioner requested the Honourable Minister to grant lease of the portion, which is proposed to be deleted by respondent No.2. It also invited respondent No.1’s intervention by maintaining status quo on the buffer area. Rule 35-A of the Rules reads as follows: “35-A. Revision: The Government may either suo motu at any time or on an application made within ninety days, call for and examine the record relating to any order passed or proceeding taken by the Director, Joint Director, Deputy Director or Assistant Director under these rules for the purpose of satisfying themselves as to the legality or propriety of such order or as to the regularity of such proceedings and pass such order in reference thereto as they think fit; Provided that no order adversely aﬀecting any person shall be passed under this rule unless such person has been given an opportunity of making his representation”. The language of the provision reproduced above is couched in widest terms regarding the power of the State Government to exercise its revisional jurisdiction which can be invoked by respondent No.1 not only to call for and examine the record relating to any order passed but also in respect of proceedings taken by the subordinate authorities, including respondent No.2. Undoubtedly, respondent No.2 initiated proceedings in the instant case by issuing show cause notice on 22-3-1999 for deletion of the excess area. In the said proceeding, it was pending before respondent no.2, the petitioner itself invited respondent No.1 to intervene in the proceedings and take appropriate decision on the issue of deletion and grant of leases for the deleted as well as buﬀer areas. Added to this, respondent No.1, evidently realized the complications arising out of occupation of excess areas by some of the lessees, including the petitioner, and the grievances expressed by respondent No.4 and other lessees due to the short falls in the areas for which they were granted leases. In this fact-situation, respondent No.1 intervened and passed the impugned order, which is directly traceable to its revisional power under Rule 35-A. Indeed, in its order respondent No.1 made a speciﬁc mention to the petitioner’s representation in the subject portion of the order. As rightly pointed out by Sri K.Pratap Reddy, learned Senior Counsel for respondent No.4, that having itself invoked the jurisdiction of respondent No.1, the petitioner cannot be allowed to approbate and reprobate. On the factual matrix of this case, no exception can, therefore, be taken for respondent No.1’s interference when the proceedings initiated by respondent No.2 were pending. Not only that, respondent No.1 was well within its power to exercise the revisional jurisdiction, but, as noted above, it did so at the instance of the petitioner itself. Hence, this Point is answered in favour of respondent No.1. Re-Point No.2: A perusal of the impugned order shows that respondent No.1 passed a comprehensive order after considering the representation of the petitioner, its various applications for granting leases apart from the applications of other companies. Rule 35-A of the Rules does not envisage an opportunity of personal hearing. The Proviso to the said Rule bars respondent No.1 from passing an order adversely aﬀecting any person without giving him an opportunity of making his representation. It is the admitted case of the petitioner that respondent No.1 passed the order on its representation. It is not the pleaded case of the petitioner that at any point of time it made a request to respondent No.1 for giving it an opportunity of personal hearing. The law is well settled that unless the Statute speciﬁcally provides for an opportunity of personal hearing, there is no obligation for the statutory authorities to aﬀord such an opportunity, unless the party makes a request in that regard. In this view of the matter, I see no merit in the contention of the learned counsel for the petitioners that the order passed by respondent No.1 is in violation of principles of natural justice. Adverting to the grievance of the petitioner that respondent No.1 deleted excess area unilaterally, without calling for the option from the petitioner, I have carefully gone through the record. In its explanation dated 28- 3-1999 submitted to respondent No.2 the petitioner categorically averred that it has developed the entire area in general and Northern portion in particular; and that if Northern portion of the demarcated area is taken away, it will cause irreparable loss to it. In the counter-aﬃdavit ﬁled by respondent No.1 a reference was made to the said request of the petitioner not to delete the Northern area as it was fully developed, and it was stated that on the said request the Department decided to delete the Southern portion of area, which is non-developed, instead of deleting the area on the Northern side. In my considered view, deletion of excess area on the Southern portion is very much in conformity with the request made by the petitioner not to delete the Northern portion as it was stated to be fully developed by investing huge money. Therefore, I do not ﬁnd any merit in the contention of the learned counsel for the petitioner in Writ Petition No.771 of 2001 that the decision to delete the excess area on the Southern portion is either arbitrary or unilateral. This point is accordingly decided. Re-Point No.3: Rule 12 of the Rules governs granting of quarry lease for minor mineral. Sub-Rule (5) of Rule 12 deals with grant of quarry lease for granite useful for cutting and polishing. Under sub-clause (b) of Clause 5 of Rule 12, the application for grant of prospecting license or quarry lease for granite shall be disposed oﬀ by the Director in the order of their receipt. Whenever more than one application is received on the same day, the Director shall grant license or lease to the deserving applicant on merits to be recorded in writing. This Rule fell for consideration of this Court in Pradeep Minerals and Granites (1 supra). The learned Single Judge, who considered Rule 12 as it stood then, held that though there is no express rule requiring the authorities to advertise the date of auction, the authority should invite bids through advertisement to get the maximum rates. It was further held that the auction of an area for quarrying lease would necessarily be after due advertisement, though the Rule does not provide for an advertisement, either in the newspaper or in the Gazette notification. This conclusion was drawn by the learned Judge by interpreting the phrase “all applications” in Rule 12 (1) by holding that the question of making applications would arise when they are invited for the purpose of granting quarry lease by public notice either by way of paper publication or by way of Gazette notification. It was also held that Rule 12 (1) pre-supposes the act on the part of the oﬃcials that they had already advertised the availability of the land for public auction in case of sand or in case of other minerals, applications were already invited, and it is thereafter only, that the applications for quarry lease could be disposed of regarding sand and other minerals on the basis of the priority in the applications, subject to the other preferences available to the categories of persons. In coming to this conclusion, the learned Judge relied on two judgments of the Supreme Court in Vadde Labour Contract Co-operative Society Limited vs. The Secretary to Government[2] and Devangula Laxminarayana vs. Director of Mines and Geology[3]. On this premise, the learned Judge held that without advertisement in a speciﬁc mode known to law, if any quarry lease is granted in favour of one person or the other, the same would be contrary to the scheme of the Rules. The said judgment was questioned in WA.Nos.750 and 924 of 1998 before a Division Bench of this Court. The Division Bench rejected the contention of the State Government that in the absence of Rule providing for procedure of advertisement, the reasoning of the learned Judge was not correct. The Division Bench observed that the doctrine of fairness in action requires Rule 12 to be interpreted in the manner in which the learned Single Judge did. The Division Bench relied on the judgment of the Supreme Court in Ajit Singh vs. Union of India and others[4], which also laid down that the requirements of notifying the prospective entrepreneurs about the availability of mining lease cannot be dispensed with. The Bench relied on the following paragraph in the judgment in Ajit Singh (4 supra): “… But in respect of third parties, the matter regarding availability of the area in question for regrant cannot be allowed to rest on the internal communication between the oﬃcials concerned of the State Government and the applicant for the mining lease the relevant facts regarding which would not be known to public and are only contained in the oﬃce ﬁles. Since grant of mining lease involves grant of a privilege by the State, every applicant for such mining lease must have an equal opportunity to apply for the same. This can be achieved only if a public notice is issued about the availability of the area for regrant so tat an intending applicant knows about the availability of the area for grant and can submit his application for that purpose.” The Bench also relied on TVL Sundaram Granites vs. Imperial Granites Ltd.[5], wherein the Supreme Court held that the direction given by the High Court to notify fresh applications for considering grant of granite quarry lease did not cause serious prejudice to any party. This judgment, it is admitted by the learned counsel for all the parties, was aﬃrmed by the Supreme Court with the dismissal of the SLP. The law is thus well settled that though Rule 12 does not expressly provide for calling applications through advertisement, such a requirement is read into this provision. It is therefore required to be taken that whenever a quarry lease is available for grant, it is incumbent upon the competent authority under Rule 12 to invite applications through a transparent method of advertisement. Admittedly, in these cases no such procedure has been followed. Even before the excess area available for grant was determined by respondent No.1, the petitioner and respondent No.4 in WP.No.771 of 2001 applied for grant of the area by their applications dated 12.08.1999 and 09.08.1999 respectively. The petitioner in WP.No.1996 of 2001 has claimed to have applied for prospecting license and quarry lease in respect of the same area on 23.12.2000, by which time respondent No.1 already passed the impugned order by which respondent No.4 was granted 1.33 Hectares found to be in occupation of the petitioner in excess of its leased area. Though allotment of 0.11 Hectares to respondent No.4 to make good the short fall cannot be found fault with, granting of lease of 1.33 Hectares to respondent No.4 on the purported ground that its application is earlier in point of time than the application of the petitioner cannot be sustained as the same is contrary to the dicta laid down by the Supreme Court and this Court in the aforementioned cases. After the excess area was determined, the competent authority ought to have invited applications through advertisement before considering the applications for grant of quarry lease by following the method laid down in Rule 12 (5) of the Rules. As respondent No.1 failed to follow this mandatory procedure, the grant made in favour of respondent No.4 to the extent of 1.33 Hectares, which was retrieved from the petitioner in WP.No.771 of 2001 is liable to be and is accordingly set aside. Respondent No.2 shall invite applications for granting prospecting license/quarry lease in respect of the said extent of 1.33 Hectares in Sy.No.168 and consider and decide the applications received by him accordance with Rule 12(5) of the Rules. On the premises as above, WP.No.771 of 2001 is allowed to the extent indicated above and WP.No.1996 of 2001 is disposed of. As a sequel to disposal of both the writ petitions in the manner indicated above, WVMP Nos.2101 and 2632 of 2001 and WPMP.No.902 of 2001 in Writ Petition No.771 of 2001; and WVMP No.2585 of 2001 and WPMP No. 2495 in Writ Petition No.1996 of 2001 are disposed of as infructuous. ------------------------- ----------- C.V.NAGARJUNA REDDY,J Date:30-9-2008 MNR LR copies to be marked: Yes/No. [1] 1998 (3) ALD 519 [2] 1995 (3) ALD 343 [3] AIR 1991 AP 167 [4] 1995 Supp. (4) SCC 224 [5] 1999 (6) SCALE 557