* IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 8004/2007 Reserved on : 5th December, 2007. Decided on : 18th February, 2008. NATIONAL MINERAL DEVELOPMNET CORPORATION ..... Petitioner Through Mr. Soli Sorabjee, Sr. Adv. with Mr. U.U.Lalit, Sr. Advocate with Mr. N.K.Kaul, Sr. Advocate with Mr. P.S.Narashimha, Mr. K.Raghacharya, Mr. Sridhar Potaraju, Mr. Pritesh Kapur and Mr. D. Julias, Advocates versus GOVERNMENT OF INDIA & ORS ..... Respondents Through Mr. P.P.Malhotra, ASG with Ms. Anjana Gosain, Advocate for R-1 Mr. Arun Jaithley, Sr. Advocate with Mr.Ravinder Srivastava, Sr. Advocate with Ms. Meena Lal, Mr. Gopal Jain, Ms. Diya Kapur and Ms. Lakshmi Ramachandran, Advocates for respondent No.3. Mr. Atul Jha, Advocate for R-2 CORAM: Mr. Justice S. Ravindra Bhat 1 . Whether reporters of local papers may be allowed to see the judgment.? Yes 2. To be referred to the Reporter or not? Yes 3. Whether the judgment should be reported in the Digest Yes Mr. Justice S. Ravindra Bhat 1. In the present proceeding, under Article 226 of the Constitution of India, the Petitioner W.P.(C) 8004/2007 1 of 26 challenges the validity of the approval of the Union Government (hereafter “the Union”), Ministry of Mines, given under Section 5 (1) of Mines and Mineral (Development and Regulation) Act, 1957 (hereinafter the “MMDR Act”), for granting a prospecting license for iron ore over an area of 2500 hectares in Deposit No.1 of Bailadila Reserve Forest, Tahsil Dantewada, District South Bastar Dantewada, Chattisgarh in favour of M/s. Tata Iron and Steel Company Ltd., the third Respondent, for 2 years by invoking provisions of Section 11(5) of the MMDR Act, through letter dated 14th February 2007. 2. The Petitioner, the National Mineral Development Corporation, is a Government of India owned Public Sector enterprise engaged in mining operations throughout India. On 25th April 1991, it applied for prospecting license (hereafter referred to as “PL”) for Iron ore in Bailadila Deposit No.1 in Form B over an area of 1130 hectares (ha) in the area reserved for public sector undertakings, Bailadila range in Bastar District, Madhya Pradesh (now Dantewada District, Chattisgarh). The State Government of Madhya Pradesh had not notified the area in the Gazette for prospecting and mining and it is averred that there were no other previous applications for Deposit No.1 filed earlier to that lodged by the petitioner. In June 2002 the Petitioner submitted an application for permission to undertake mineral exploration on payment of necessary fees; inspection was carried out in February 2003. The Chief Conservator of Forests and survey, Chattisgarh forwarded that application for permission to enter into the forest for exploration, to the Ministry Environment and Forests, New Delhi. On 10th November 2006, the Government of Chattisgarh, (the state) recommended PL over an area of 2500 ha to third Respondent, on the ground that the later proposed to construct a Steel Plant in W.P.(C) 8004/2007 2 of 26 Chattisgarh. The area so recommended overlapped by 1130 ha in relation to the area applied the Petitioner. 3. Aggrieved by the decision of the state, the Petitioner filed a Revision Application on 17th January 2007 under Rule 54 of Mineral Concession Rules, 1960 framed under the MMDR Act, before the Mines Tribunal requesting it to set aside the impugned proceeding. The same is pending before the Tribunal. By letter dated 14th February 2007, i.e. the impugned order, the Central Government conveyed approval under Section 5 (1) of the MMDR Act, 1957 for grant of a prospecting license for iron ore concerning an area of 2500 ha in Deposit No.1 of Bailadila Reserve Forest, Tahsil Dantewada, Dist South Bastar Dantewada, Chattisgarh, in favour of the third Respondent for a period of 2 years, under Section 11 (5) of the MMDR Act, 1957, subject to the outcome of the revision application. The grant of this approval is impugned in the present proceeding. 4. While granting its approval, the Central Government waived the special condition imposed by the state upon the third Respondent, i.e, setting up a Steel Plant in Chattisgarh and also directed the state to comply with the provisions of the Forest Conservation Act, 1980 (hereafter referred to as the “Forest act”). The relevant portions of the letter dated 14th February 2007 is extracted below: “ I am directed to refer to your letter No.3-99/2003/12 dated 10.11.2006 on the above mentioned subject and to convey the approval of the Central Government under Section 5 (1) of the Mines and mineral (Development and Regulation) Act, 1957 to the grant of prospecting licence for iron ore over an area of 2500 hect om Deposit No.1 (Group) of Bailadila Reserve Forest, W.P.(C) 8004/2007 3 of 26 Tahsil Dantewada, Distt. South Bastar Dantewada, Chattisgarh in favour of M/s Tata Iron & Steel Ltd for a period of 2 (two) years by invoking the provisions of Sec. 11 (5) of the said Act subject to the outcome of the revision application pending against the proposal. "2. The special condition proposed by the State Government for imposition under Rule 14(3) of the Mineral Concession Rules, 1960 in the above mentioned prospecting licence is not agreed to because imposition of such restrictive condition may not be in the interest of mineral development. 3 . Before allowing grant of prospecting licence, the State Government may kindly ensure the compliance of the amended provisions of the Act and Rules, and other applicable Acts and Rules including Forest (Conservation) Act, 1980 and environmental notification dated 27.01.1994 as issued and amended by Ministry of Environment and Forests." 5. The Petitioner alleges that the issuance of the impugned order was kept secret, and under wraps until it applied for a copy of the same under the Right to Information Act, 2005 on 15th May 2007 and the same was furnished only on 28th May 2007. Thereafter, the Petitioner filed an application before Committee on Disputes for grant of clearance to challenge the impugned order, which was given on 31st July 2007 and communicated to it on 21st August 2007. 6. The Petitioner alleges that the impugned order gives away the state largesse in a highly arbitrary manner and contrary to statutory procedures, which is a clear violation of the constitutional mandate under Article 14 of the Constitution. It avers that the Union had no jurisdiction to issue the impugned order in the absence of compliance with the mandatory provision in Section 2 of the Forest Act. It alleges that the power, authority and jurisdiction to accord approval would accrue upon the Union under provisions of the MMDR Act, only in the event of strict compliance of the provisions of Forest Act. Further, in terms of the impugned order itself, the provisions of Forest Act are yet to be complied with, and therefore the impugned order is improper, without any authority besides inherent lack of power. Therefore, W.P.(C) 8004/2007 4 of 26 the Petitioner submits that no rights or obligations can ipso-facto flow from the impugned order. It alleges that condition imposed in the impugned order, with respect to the compliance under the Forest Act is nothing but an attempt to circumvent the mandatory legislative provisions. 7. It further avers that the impugned order is contrary to the law laid down by the Supreme Court in TN Godavarman Tirumalkpad v. Union of India, (1997) 2 SCC 267. Additionally, the impugned order is also violative of section 11(2) of the MMDR Act, since it ignored the preferential right of the Petitioner. It is also submitted that the third Respondent is not entitled to the grant of the licence, since the special condition for ignoring the preferential right of the Petitioner was waived by the state. 8. Mr. Soli Sorabjee, Senior counsel appearing for the Petitioner submitted that the provisions of the Forest Act 1980 were enacted in public interest for preservation and protection of the environment and to ensure sustainable development. He submits that these provisions should be strictly construed and that any interpretation, indirectly permitting or leading to its circumvention or evasion should not be accepted. He argued that prior approval of the Central Government under Section 2 of the Forest Act is a mandatory pre-condition before any order or direction relating to any of the matters mentioned in sub-clauses (i) to (iv) can be passed. He drew the attention of the Court to the opening clause of the Section 2 and emphasized that it has an overriding effect over all other laws for the time being in force. He submitted that under the proviso to Section 5 of the MMDR Act no PL shall be granted except with the previous approval of the Central Government. Apart from this, he urged that a further mandatory prerequisite is W.P.(C) 8004/2007 5 of 26 that before the actual or proposed grant or an order of approval/direction for grant of a PL, there must be prior approval of the Central Government under Section 2 of the Forest Act. The approval under the proviso to Section 5 must be preceded by the approval of the Central government under Section 2 of the 1980 Act. Consequently the approval for grant of a PL is without jurisdiction in the absence of prior approval under Section 2 of the 1980 Act. 9. The learned counsel further submitted that the impugned order grants approval for a licence, which is in breach of Section 2 (iii) of the Forest Act. Relying on the affidavit of the Respondents, he submitted that the impugned order has been construed as “an approval for grant of prospecting licence”. Furthermore, he submitted that the impugned order amounts to a direction that any forestland or any portion thereof may be used for any non-forest purpose. He submitted that the expression “other authority” in Section 2 would cover any department of the Central Government, and would also include the Ministry of Mines, Government of India. In this regard, he referred to Rules 6 and 24 of the Forest (Conservation) Rule 2003. He submitted that the definition of “user agency” makes it clear that even a department of the Central government can seek approval under Section 2 of the 1980 Act, under Rule 6 for using forestland for non-forest purposes. Rebutting the contention of the Respondent that the Central Government is well within its powers to pass an order under Section 11 (5) of MMDR Act, he pointed out to the fact that the order was passed under the proviso to Section 5 of MMDR Act. 10. In support of the contention that prior approval under Section 2 of the Forest Act is mandatory for any non-forest activity, the Petitioner placed reliance on Vishnu Kumar Khattar v. State of Bihar, AIR 1995 Pat 168(FB) wherein the Court relying upon the decisions of the Supreme W.P.(C) 8004/2007 6 of 26 Court in Ambica Quarry Works v. State of Gujarat, AIR 1987 SC 1073 and Rural Litigation and Entitlement Kendras v. State of UP, AIR 1998 SC 2187, held that approval of the Central Government is a sine qua non before the land can be put to non-forest use, whether it be an fresh application or a renewal. The Petitioner also placed reliance on the decision of the Madras High Court in M/s Golden Granites v. Shanmugam, AIR 1998 Mad 150. 11. In response to the issues raised by the Petitioner, the Respondents averred that the occasion for compliance of Section 2 of the Forest Act is yet to occur and as such allegations of violation of Section 2 are baseless and misplaced. Relying on the Guidelines for Diversion of Forest Land for Non-forest Purposes under the Forest Conservation Act, 1980, they contend that permission under the Forest Act is required for prospecting operations carried out under the PL granted under the MMDR Act and therefore, the approval under section 2 of the Forest Act is required only when the PL is actually granted and prospecting operations actually begin. They submit that the impugned order is nothing but an approval for grant of prospecting license and is not the grant of a prospecting license, subject explicitly to compliance with the Forest Act and other relevant laws. They aver that pursuant to the impugned order, the state wrote a letter to the third Respondent directing them to obtain necessary approvals under the Forest Act and produce the same in order to obtain a PL. They submit that the occasion to comply with the requirements of Section 2 of the Forest Act arose only after impugned order. The respondents also object to maintainability of the present writ Petition as being an abuse of the judicial process. It is alleged that the Petitioner has sought the quashing of the order by the State Government, recommending grant of PL made in Novermber, 2006. The pendency of that W.P.(C) 8004/2007 7 of 26 Petition has not been disclosed. 12. Mr. Arun Jaitley, Senior counsel appearing on behalf of the third Respondent submitted that the order of the Central Government can be invalidated only if there is clear proof of infringement of statutory law of mandatory character, which in the present case, according to the petitioner is occasioned by non compliance of Section 2 of the Forest Act, which mandates that no order directing use of forest land for non forest purposes should be granted without the prior approval of the Central Government. He urges that the order permitting forest land be put to non-forest use is yet to be given by the State Government while granting the prospecting license. He contends that it cannot be argued that the approval of the Central Government under the proviso to Section 5 (1) of the MMDR Act is an “order directing” that forest land be put to non-forest use. Further, it also cannot be argued that the recommendation of the State Government for grant of prospecting license in favour of an applicant is an order contemplated under Section 2 of the Forest Act, which would require prior approval of the Central Government. 13. He submits that it is only the State Government which has the power to grant a PL and the Central Government under S.5 of the MMDR Act is merely an approving authority, but the license is required to be issued only by the State Government under S.10 MMDR Act read with Rule 15 of the Mineral Concession Rules, which becomes effective from the date of issuance under Rule 15 (2). He submits that the third Respondent will acquire the right to undertake prospecting operation only thereafter as per S.4 of the MMDR Act. However, he submits that the user agency cannot commence the prospecting operations without being granted prior W.P.(C) 8004/2007 8 of 26 approval of the Central Government under S.2 of the Forest Act. Further, he submits that terminology employed in Section 2 of the Forest Act “other authority”, and that the Central Government cannot be said to be the “other authority”, as such an interpretation would lead to absurdity, where the Central Government will have to take approval from itself. 14. Mr. Ravinder Srivastav, Senior counsel, also appearing on behalf of the Respondents submitted that the for the grant of approval under Section 2 of the Forest Act, the land proposed to be put to non forest use has to be determined. According to him, such determination can occur only once the approval under Section 5 of the MMDR Act is granted by the Central Government. He further submits that under Forms A and B of the Forest Conservation Rules, under which the Section 2 application is to be made, the user agency/ proposed licensee must furnish details of the forest land, including a map showing the required forest land and the purpose wise breakup of the total forest land required. It is submitted, that these details can be furnished only when approval under section 5 of the MMDR Act is granted by the Central Government. He also placed reliance on the “Guidelines for Diversion of Forest Land for Non-Forest purposes under the Forest Conservation Act, 1980”, issued by the Government of Chattisgarh, which states that permission under the Forest Act is required for prospecting operations carried out under the MMDR Act, and therefore, he submits that approval under the Forest Act is required only when the license is granted under the MMDR Act. He also relied on the judgment of the Andhra Pradesh High Court in Hyderabad Abrasives and Minerals v. Government of A.P, AIR 1990 AP 257, where the Court held as follows: “What is material for the purpose of the Forest Conservation Act, 1980 W.P.(C) 8004/2007 9 of 26 is not the date on which the lease is granted but the date on which the State Government or other authority permits the breaking up, or the clearing of the forest land, or any portion thereof.” 15. Before entering the discussion on merits, it would be not inappropriate to deal with some of the concerns raised by the Respondents in the course of their arguments, as to the maintainability of the present writ petition. The Petitioner had preferred a revision against the 10th November 2006 order of the state, recommending the grant of PL to the third Respondent, before the Mines Tribunal which is still pending. The Petitioner also filed a petition ( CW No. 2127/2007) in the Chhattisgarh High Court on 17th March 2007 for quashing of the recommendatory order of the state (the State) or for directing the Revisional Authority to grant stay until the proceedings were completed. Additionally, it also sought that the third Respondent should be directed not to take any action pursuant to the order of the State. 16. The Petitioner’s submission is that when the third Respondent impleaded itself in the revisional proceedings on the 16th April 2007 and produced the impugned order did it become aware of the existence of the impugned order. It therefore, submits that the stay application (before the Chhatisgarh High Court) had become infructuous and therefore was not pressed on 27th April 2007 when it was taken up for hearing. Therefore, it filed the present writ for quashing the order of the Union, after obtaining the necessary clearance from the Committee (of Secretaries) on Disputes. 17. The objections to maintainability seem attractive, at the outset. It is settled law that a petitioner who approaches the writ court for an equitable order should make full disclosure of all facts. The question is whether the writ petitioner can be faulted for proceeding, piece meal, W.P.(C) 8004/2007 10 of 26 as it were, and not disclosing about pendancy of the writ petition in Chattisgarh. The subject matter of that writ petition was the legality of the recommendation by the state government. The writ petitioner had premised its challenge on the ground that there being a prior reservation, under Section 11 the state could not have recommended the prospecting license to a non-PSU. However, the petitioner did not question jurisdiction of the State to recommend the area for non-forest purposes. That issue did not arise in the proceeding. Here, however, the petitioner questions the basic jurisdiction of the State to make any recommendation; the impugned order of the Central Government has therefore been challenged as without authority of law. Indeed that writ petition, as urged before the court here, was preferred in ignorance of the impugned order of the Central Government. The petitioner claims to have become aware of the impugned order, after its disclosure in the revisional proceedings by the state; it sought for a copy from the Union Ministry of Mines, under the Right to Information Act on 15-5-2007. A copy was made available on 28-5-2007; being a Public Sector Undertaking, the petitioner was obliged to secure necessary approval of the Committee of Secretaries (of the Union) to challenge the impugned order. The application was made on 11-5-2007 on the basis of a copy of the order; it was granted on 20th August 2007. The present writ petition was thereafter preferred. These facts (brought out in the petitioner’s affidavit dated 21-11-2007) have not been disputed. 18. Speaking of exercise of discretion in refusing to entertain a writ petition on the ground of a litigant availing an alternative remedy and not disclosing those facts, the Supreme Court, in SJS Business Enterprises –vs- State of Bihar AIR 2004 SC 2421 held that though existence of or even availing an alternative or parallel remedy may be a factor, the not the predominating one, W.P.(C) 8004/2007 11 of 26 while exercising discretion to entertain a writ petition. Here, the parallel proceeding concerned is the Chhatisgarh writ petition. In that, the writ petitioner sought quashing of the state government’s recommendation and also for a direction to the revisional authority to hear and dispose of its revision. At that stage, the petitioner was in the dark about the existence of the order dated 14-2-2007. The circumstances whereby it gained knowledge and the surrounding factors which constrained it to challenge the order, by securing the approval of the Committee of Secretaries (being a Union PSU, it could not have acted otherwise) show that there was no intention to abuse the judicial process by filing the present writ petition. Moreover, the questions raised here involve the jurisdiction of statutory authorities, in view of provisions of the Forest Act. 19. In Narendra Kumar Maheshwari v Union of India and Others: 1990 (Suppl) SCC the Supreme Court dealt with comity of courts in a federal structure. The court held that:- “Before we conclude, we must note that good deal of argument was adduced that these applications in different High Courts in civil suits were not genuine and properly motivated, but were mala fide. Even though these might not have been to fee fat an innocent object, it was apparent that it was to feed fat a grudge in respect of a competitive project by a competitor. Anyway, in the view we have taken, it is not necessary to decide the bona fides or mala fides of the applicants. Shri Nariman, when he moved the application initially, had suggested that we should lay down certain norms as to how the courts in different parts of the country should grant injunction or entertain applications affecting an all-India issue or having ramifications all over the country. Except that before the courts grant any injunction, they should have regard to the principles of comity of courts in a federal structure and have regard to self-restraint and circumspection, we do not at this stage lay down any more definite norms. We may also perhaps add that it may be impossible to lay down hard and fast rules of general application because of the diverse situations which give rise to problems of this nature. Each case has its own special facts W.P.(C) 8004/2007 12 of 26 and complications and it will be a disadvantage, rather than an advantage, to attempt and apply any stereotyped formula to all cases. Perhaps in this sphere, the High Courts themselves might be able to introduce a certain amount of discipline having regard to the principles of comity of courts administering the same general laws applicable all over the country in respect of granting interim orders which will have repercussion or effect beyond the jurisdiction of the particular courts. Such an exercise will be useful contribution in evolving good conventions in the federal judicial system.” 20. In Hartford Fire Ins. Co. v. Cal., 509 U.S. 764, it was observed that the comity of courts refers to a situation where judges decline to exercise jurisdiction over matters more appropriately adjudged elsewhere. In Parsi v. Davidson: 405 U.S. 34, it was observed that under accepted principles of comity, a court should stay its hand only if the relief the petitioner seeks would also be available to him with reasonable promptness and certainty through the alternative machinery. This court would have to undoubtedly keep these principles in mind in the present case. The issue therefore is whether it can be said that this court should decline to exercise jurisdiction in respect of the subject matter of