*THE HON’BLE SRI JUSTICE C.V.NAGARJUNA REDDY + WRIT PETITION NO.15062 OF 2004 % 09-07-2010 # Between: Sri Satya Enterprises ….Petitioner A N D Secretary to Government and two others ….Respondents ! COUNSEL FOR THE PETITIONER: Smt A.Padma ^COUNSEL FOR RESPONDENT NO.1: G.P for Mines and Geology ^COUNSEL FOR RESPONDENTS 2 & 3: G.P for Panchayat Raj < Gist: > Head Note: ? CITATIONS: THE HON’BLE SRI JUSTICE C.V.NAGARJUNA REDDY WRIT PETITION NO. 15062 OF 2004 Dated 9th July, 2010 Between: Sri Satya Enterprises …Petitioner And Secretary to Government and two others …Respondents Counsel for the petitioner : Smt A.Padma Counsel for respondent No.1: G.P for Mines and Geology Counsel for respondents 2 & 3: G.P for Panchayat Raj The Court made the following ORDER: This writ petition is filed for a Mandamus to set aside proceedings dated 18.05.2004, whereby the respondents have shown a sum of Rs.1,13,570/- as recoverable from the final bill in respect of the contract bearing No.ADBP-16. The petitioner is a Contractor, whose tender was accepted by respondent No.3 for execution of work relating to upgradation of rural road work in Adilabad District. The petitioner entered into an agreement with respondent No.3 on 30.03.2000 for execution of the said work, whose approximate value was Rs.128 lakhs. According to the petitioner, the work was completed on 24.07.2002. During the course of the execution of the said work, respondent No.1 issued G.O.Ms.No.331, Industries and Commerce (M-I) Department dated 21.06.2000, notifying an amendment to Sub-Rule (1) of Rule 10 of the Andhra Pradesh Minor Mineral Concession Rules, 1966 (for short “the Rules”). The said amendment, inter alia, amended Schedules I and II of the Rules. The present case pertains to Schedule–I dealing with the rates of seigniorage charges, which were revised at Rs.33/- per cubic meter for building stone; rough stone and road metal. By the impugned letter, respondent No.2 had shown the sum of Rs.1,13,570/- as recoverable at the revised rates of seigniorage charges applying the above amended Rule. Feeling aggrieved by the said letter, the petitioner filed the present writ petition. At the hearing, Smt V.Padma, learned counsel for the petitioner, submitted that in the face of the concluded contract between the petitioner and the respondents, the former cannot be saddled with the additional liability by applying the amended Rule, which came into force during the course of execution of the contract. In support of her contention, the learned counsel placed reliance on judgment dated 25.06.2004 of this Court in Writ Petition No.10568 of 2004. (M/s Sri Venkateshwara Constructions vs. The Superintending Engineer, Panchayat Raj Circle, Warangal and others). The learned Assistant Government Pleader for Panchayat Raj, opposed the above contentions of the learned counsel for the petitioner, and submitted that the agreement entered into between the parties is silent on the seigniorage charges and therefore, the petitioner is bound by the Rules, which are in force from time to time. The learned Assistant Government Pleader placed reliance on Clause 45.1 of the Conditions of Contract A - General, in support of his submission. I have carefully considered the submissions of the learned counsel for the parties. It is not in dispute that there is no specific reference to payment of seigniorage charges in the agreement entered between the parties. In the absence of such agreement, the parties are governed by the Rules. Under Rule 10 of the Rules, the seigniorage fee or dead rent, whichever is higher shall be charged on all minor minerals dispatched or consumed from the land at the rates specified in Schedules I and II as the case may be. Under Sub-Rule (3) (b) of Rule 10 of the Rules, the seigniorage fee shall be paid before the mineral is removed from the leased area. This Rule thus makes it clear that the person who removes the mineral from the leased area is liable to pay seigniorage charges “at the rates specified in Schedule-I”. The rates specified in the said schedule which were in force when the agreement was entered into were specifically revised by the abovementioned amendment. The said amendment came into force during the currency of the agreement with the petitioner. In the absence of prescription of specific rate in the agreement between the parties, the right of the respondents to apply the revised rates as per the amendment, which came into force during the subsistence of the agreement, cannot be curtailed. The judgment of this Court in Sri Venkateshwara Constructions (supra), on which reliance is placed by the learned counsel for the petitioner, is of no help to the petitioner. In that case, the Clause by way of Clause 4(x) was specifically incorporated in the agreement, whereby it was envisaged that the seigniorage charges will be recovered from the contractor’s bills in terms of G.O.Ms.No.195 dated 10.05.1999 at the prevailing rates as on the date of the agreement. Construing the said clause, this Court held that in the absence of any clause in the contract, giving liberty to the respondents to collect seigniorage charges at the revised rates during the subsistence of the contract, it was not open to the respondents to unilaterally alter the terms and conditions of the contract or to recover the seigniorage charges at rates higher than what were agreed upon under the agreement. In the instant case, no Clause similar to Clause 4(x) of the agreement referred to above exists in the agreement between the parties. Therefore, in my opinion, the petitioner is bound to pay seigniorage charges at the rates, which were prescribed from time to time during the currency of the agreement. While the respondents cannot recover the revised seigniorage charges for the period anterior to 21.06.2000, they are certainly entitled to apply the revised rates from the date of the amendment of Schedule-I under G.O.Ms.No.331 dated 21.06.2000. My view of this is fortified by a Division Bench judgment of this Court in M.C. Constructions Limited vs. The Engineer in Chief, R & B, Hyderabad and others (Writ Petition No.26040 of 2001). For the abovementioned reasons, I do not find any merit in the writ petition and the same is accordingly dismissed. C.V.NAGARJUNA REDDY, J Dated 9th July, 2010 vrn Note: L.R. copies to be marked.