IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE TWENTY FIRST DAY OF OCTOBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MS JUSTICE G.ROHINI WRIT PETITION NO : 11065 of 2008 Between: Smt. Shaik Nusrath Banu, W/o. Abdul Gani, R/o. D.No. 26-44-22,2/1, Venkataramana Colony (Near NGO's Colony), Guntur 522 001. ..... PETITIONER AND 1 The State of Andhra Pradesh, Rep. by its Secretary (Mines), Government of Andhra Pradesh, Secretariat Buildings, Hyderabad 500 022. 2 The Director of Mines & Geology, 8th Floor, B.R.K.R.R. Buildings, Tank Bund Road, Hdyerabad 500 029. 3 The Deputy Director of Mines & Geology, Guntur, H.No. 1/1, Ramannapet, 1st Lane, Koritipadu, Guntur 522 002. 4 The Assistant director of Mines & Geology, H.No. 5-76/22 4th Lane, 2nd Cross Road, Pandaripuram, Guntur 522 002. 5 M/s. Perecherla Quarry Workers L.C.C.S. Limited, Perecherla, Guntur District - Rep. by its Director, Sri Gandikota Tangella. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to issue a Writ, order or direction more so one in the nature of Mandamus declaring the action of the 1st respondent in issuing the Impugned Memo No. 12364/M.II(1)/2007-1, Industries & Commerce (Mines -II) Department dt. 14-05-2008 as illegal, arbitrary, violative of the provisions of the Mines and Minerals (Development & Regulation) Act, 1957 and the Rules made thereunder apart from being violative of the Article 14 of the Constitution of India and the orders passed by this Hon'ble Court vide Judgment dt. 28-03-2008 in WP No. 15173/2007 ﬁled by the Petitioner and consequently direct the respondents to dispose of the said application dt. 16- 04-2007 of the Petitioner within a ﬁxed period of time along with other applications in accordance with law in the interest of law and justice. Counsel for the Petitioner : MR. PANNALA.SRINIVAS Counsel for the Respondents : GP FOR MINES AND GEOLOGY The Court made the following : *THE HON’BLE Ms. JUSTICE G. ROHINI + WRIT PETITION No.11065 OF 2008 % 21/10/2008 # Smt. Shaik Nusrath Banu … Petitioner Vs. $ 1. The State of A.P., represented. by its Secretary (Mines), Government of Andhra Pradesh, Secretariat Buildings, Hyderabad-500 022 and 4 others. .. Respondents < Gist > Head Note: ! Counsel for the petitioner : Sri Pannala Srinivas ^ Counsel for the respondents : G.P. for Mines & Geology, and Smt. S. Swarna Reddy Cases referred : [1] AIR 1993 SC 147 THE HON’BLE MS. JUSTICE G. ROHINI WRIT PETITION No.11065 OF 2008 ORDER: This writ petition is ﬁled seeking a declaration that the action of the 1st respondent in issuing Memo No.12364/M.II(1)/2007-1, Industries & Commerce (Mines-I) Department, dated 14.05.2008 as well as the consequential order passed by the 3rd respondent dated 21.05.2008 granting quarry lease for road metal in favour of the 5th respondent for a period of ten years with eﬀect from 13.07.2007 as arbitrary, illegal and contrary to the provisions of the Mines and Minerals (Development & Regulation) Act, 1957 and the Rules made thereunder. Admittedly, the 5th respondent herein, which is a Labour Contract Co-operative Society registered under the A.P. Co- operative Societies Act, 1964 was holding the said quarry lease over an extent of 8 acres in Sy.No.155/A1 of Chinapalakalur Villadge, Guntur District, for the period from 1997 to 2007 which was valid upto 12.07.2007. Since the 5th respondent society did not make any application for renewal within the time prescribed and a resolution was also passed by the general body of the society on 10.09.2006 not to apply for renewal, the writ petitioner submitted her application dated 16.04.2007 for grant of the said lease. Pursuant thereto, the 4th respondent/Assistant Director of Mines and Geology, after inspection, survey and demarcation of the applied area, recommended grant of mining lease in favour of the petitioner. At that stage, the 5th respondent society made an application dated 26.6.2007 for renewal of its quarry lease. Apprehending that the respondents 3 and 4 may grant the lease in favour of the 5th respondent society without considering the petitioner’s application dated 16.04.2007, the petitioner ﬁled W.P.No.15173 of 2007 seeking a declaration that the action of the oﬃcial respondents in not considering the petitioner’s application dated 16.04.2007 was arbitrary and illegal. The said writ petition was disposed of by this Court by order dated 28.03.2008 with a direction to the Government of Andhra Pradesh to consider the applications of the petitioner dated 16.04.2007 as well as the 5th respondent dated 26.06.2007, taking into consideration the objections ﬁled by the petitioner dated 9.08.2007 and pass appropriate orders in accordance with law within a period of four weeks. Thereafter, the 1st respondent issued the impugned memo dated 14.05.2008 according permission to the 3rd respondent - Deputy Director of Mines and Geology, Guntur, for grant of quarry lease in favour of the 5th respondent society by condoning the delay in ﬁling renewal application dated 26.06.2007. Pursuant thereto, the 3rd respondent granted mining lease in favour of the 5th respondent society for a period of 10 years vide proceedings dated 21.05.2008 followed by work order dated 22.05.2008. Hence, the present writ petition seeking a mandamus declaring the 1st respondent’s Memo 14.05.2008 as well as the subsequent proceedings of the respondents 3 and 4 dated 21.05.2008 and 22.05.2008, as arbitrary and illegal. The 4th respondent - Assistant Director of Mines and Geology, Guntur - ﬁled a counter-aﬃdavit on behalf of the respondents 1 to 4 stating that the order dated 14.05.2008 passed by the 1st respondent was well within the power conferred under the law. It is explained that the applied area being a Government land and classiﬁed as ‘hill poramboke’, the Mandal Revenue Oﬃcer, Guntur Rural Mandal by letter dated 18.05.2007 recommended for grant of quarry lease after expiry of the existing lease period on 17.07.2007 for a further period of ﬁve years. By that time, three applications were received on 16.04.2007 for grant of lease over the area in question including the application of the writ petitioner. Subsequently, before the expiry of the 5th respondent’s existing lease, an application was received from the said society represented by one of the Directors by name Gandikota Thangella on 26.06.2007 requesting for grant of lease in favour of the 5th respondent society. In response to the letter dated 2.07.2007, the District Co-operative Oﬃcer, Guntur, informed that the application of the society dated 26.06.2007 was genuine. In the circumstances, the 4th respondent having considered the merits and demerits of all the applications received by that time submitted his report to the 3rd respondent recommending to grant the quarry lease in favour of the 5th respondent society for a period of 10 years and to reject the applications of other applicants, including the writ petitioner. In turn, the 2 nd respondent - Director of Mines and Geology after obtaining sanction of the Government vide memo dated 14.05.2008, requested the 3rd respondent to take necessary action to grant the quarry lease in favour of the 5th respondent. Accordingly, the 3rd respondent, by order dated 21.05.2008 granted quarry lease in favour of the 5th respondent society for a further period of 10 years with eﬀect from 13.07.2007 by way of a second renewal. A separate counter-aﬃdavit has been ﬁled on behalf of the 5th respondent society justifying the impugned orders and stating that pursuant to the order dated 21.05.2008 a lease agreement has been entered into between the respondents 4 and 5 on 22.5.2008 and that the members of the society have been operating the quarry. I have heard the learned counsel for both the parties and perused the material on record. The learned counsel for the petitioner contended that the impugned Memo of the 1st respondent dated 14.5.2008 is arbitrary and illegal apart from being contrary to Rule 12(2) and (3) of the Rules since the 1st respondent failed to record reasons as to why the period prescribed for making renewal application should be overlooked. It is also contended that the 1st respondent has no authority under law to condone the delay in making the renewal application. So far as the order of the 3rd respondent dated 21.5.2008 is concerned, it is contended that rejection of the petitioner’s application as premature is illegal. While relying upon the decision in LABOUR CONTRACT CO-OP. SOCY. v. DIRECTOR, MINES & GEOLOGY, HYDERABAD [1] the learned counsel vehemently contended that since the petitioner’s application, which was received 87 days before the expiry of the lease period, falls under the second category she is entitled to preference over and above the application of the 5th respondent which was received 17 days before the expiry of lease and thus falls under the third category. On the other hand, the learned Government Pleader for Mines and Geology as well as the learned counsel appearing for the 5th respondent society submitted that the 5th respondent being a Labour Contract Co-operative Society is entitled to preference over the applications of the individuals and therefore the grant of lease in favour of the 5th respondent society under the impugned proceedings is in accordance with law and warrants no interference by this Court. Admittedly, the 5th respondent society was originally granted a quarry lease for road metal in respect of the land in question. The lease initially granted in its favour was renewed once for a period of 10 years from 1997 to 2007 upto 12.07.2007. Since the road metal is a minor mineral speciﬁed under Item No.3 of Schedule-I to Rule 10, the grant of lease is governed by Rules 12 and 13 of the A.P. Minor Mineral Concession Rules, 1966. Rule 13 (2) provides that the application for the renewal of quarry lease shall be made at least 90 days before the expiry of the period of lease. Rule 12 (4) provides that in cases where the quarry leaseholders failed to apply for renewal of the lease within 90 days before the expiry of the lease held by them as required under Rule 13 (2), a fresh application for grant of quarry lease in respect of those areas will be entertained 30 days before the expiry of the lease. Thus, the 5th respondent was required to make an application for renewal on or before 13.04.2007 i.e., 90 days before the expiry of the lease on 12.7.2007. However, the 5th respondent society did not apply for renewal within the said period and the renewal application on its behalf could be made only on 26.6.2007 i.e., 17 days before the expiry of the lease held by it. Much prior to that, the writ petitioner made an application for grant of lease on 16.4.2007. It is claimed by the petitioner that though she was a member of the 5th respondent society, she resigned from the membership and the same was accepted on 4.6.2006 and therefore she made the application dated 16.4.2007 in her individual capacity for grant of mining lease. Having considered all the applications received, the 3rd respondent – Deputy Director of Mines & Geology – who is the competent authority under Rule 12 of the Rules, by order, dated 21.05.2008, granted quarry lease in favour of the 5th respondent society by way of second renewal. All other applications, including the application of the writ petitioner, were rejected as premature. The question that falls for consideration is whether the said order of the 3rd respondent is in accordance with law. It is true that as per Rule 13 (2) of the Rules, the 5th respondent should have made the application for renewal on or before 13.04.2007 i.e., at least 90 days before the expiry of its existing lease and there is no speciﬁc provision under the Act or the Rules for condonation of delay in making the application within the said period. However, the learned counsel for the respondents sought to justify the order of the 1st respondent dated 14.05.2008 on the basis of Rule 11 (1) (b) of the Rules under which the Government reserves the right to grant the leases for any minor minerals by duly exempting from the priorities ﬁxed under diﬀerent provisions under the Rules in favour of any section of the society. The learned counsel for the respondents also submitted that since the 5th respondent is a Labour Contract Co- operative Society and all its members are depending on the quarry work for their livelihood and particularly in view of the fact that the society has been holding the lease for the past about 20 years, the 1st respondent cannot be held to have committed any error in according sanction for grant of lease in favour of the 5th respondent society by way of renewal duly condoning the delay in making renewal application. On a careful consideration of the facts and circumstances of the present case and particularly Rule 11 (1) (b) of the Rules, I ﬁnd force in the above submissions of the learned counsel for the respondents. Even assuming that the order of the 1st respondent dated 14.05.2008 is illegal in the absence of a speciﬁc provision under the Act or the Rules for condonation of the delay in making the renewal application, it is relevant to note that there is no bar under the Act or the Rules to consider the 5th respondent’s application dated 26.6.2007 as an application for fresh lease along with other applications. Hence, the next question that requires consideration is whether the 5th respondent is entitled for grant of lease in question if it is treated as an application for fresh lease. Rule 12 (2) of the Rules which prescribed the procedure with regard to consideration of applications for grant of quarry lease for minor minerals under Schedule-I to Rule 10 { except sand, granite & minerals speciﬁed under Items 1 (a) & (b) } runs as under : “Rule 12 (2). Whenever more than one application are received for grant of a quarry lease for minor minerals except sand, granite useful for cutting and polishing and also the minerals speciﬁed under items, 1 (a) and (b) under Schedule-I to Rule 10 the Deputy Director shall dispose of the applications in order of preference specified below:- (i) Applications of Government Department and Government Corporations and Companies; (ii) Applications of Labour Contract Co-operative Societies; (iii) Applications of unemployed persons who possess any recognized qualiﬁcation in Geology, Geophysics, or Mining Engineering or any other allied subjects; (iv) other applications; Provided that in cases falling under any of the categories (i) to (iii) above, the grant of lease shall be subject to the condition that lessee shall work the quarry directly and shall not hand it over to any other party for working : Provided further that the Deputy Director may refuse to accord preference to the application of a Labour Contract Co-operative Society, if he ﬁnds that the particular society does not work properly in the interest of the workers concerned : Provided also that whenever more than one application falling under any of the categories (i) to (iii) above are received for grant of a quarry lease and have to be considered under the order of preference prescribed above, Deputy Director shall refer matter to Government with his recommendation for a direction : Provided also that whenever more than one application falling under category (iv) above are received for grant of quarry lease and have to be considered in the order of preference speciﬁed above, such preference shall be given to the applications according to the date of their receipt, unless the Government, for special reasons, otherwise direct and in case of applications received on the same day, the Deputy Director after taking into consideration the particulars furnished in the applications, may grant the lease to any deserving applicant; or he may, will the previous approval of the Director, grant a quarry lease to an applicant whose application was received later in preference to an earlier application for any special reason to be recorded in writing.” Admittedly the road metal, in respect of which the quarry lease is granted in the instant case, falls under Item No.3 of Schedule-I to Rule 10. Similarly, there is no dispute that the 5th respondent is a Labour Contract Co-op. Society, whereas the petitioner is an individual. Thus, in the order of preference speciﬁed under Rule 12 (2) the 5th respondent’s application falls under category-ii where as the petitioner’s application falls under category-iv i.e., other applications. Hence, the 5th respondent is entitled for preference over and above the writ petitioner. It is relevant to note that in LABOUR CONTRACT CO- OPERATVE SOCIETY’S case (1 supra) the Supreme Court was dealing with the applications received under category-iv of Rule 12 (2) which prescribed the procedure where more than one application falling under category-iv were received. The Supreme Court after considering the scope and extent of Rule 12 and Rule 13 of the Rules held that whereas an existing lessee has to apply for renewal at least 90 days before the expiry of the period of his lease, the applications received from others have to be treated as second category applications and they should be received under Rule 12 (4). The applications received within 30 days of the expiry of lease shall also be received along with the applications received after the expiry of lease and they should be treated as third category. It was further made clear by the Supreme Court that the application for renewal ﬁled by the existing lessee under Rule 13 (2) shall be taken up ﬁrst and disposed of. In case no such application is received, the second category applications shall have to be taken up and considered. In case no application falling in the second category is received, the third category applications should be considered. It was also made clear that the applications received shall be placed in their proper category and considered in the order indicated above. As expressed above, in the case before the Supreme Court the dispute related to inter se priority among the applications received in category-iv of Rule 12 (2) of the Rules. In the instant case, though the petitioner’s application falls under category-iv, admittedly the 5th respondent’s application comes under category-ii. Hence, it is not a case of inter se priority among the applications received in category-iv. Consequently, the applications of the petitioner, the 5th respondent and other applications shall be disposed of in order of preference speciﬁed under Rule 12 (2) of the Rules and automatically the 5th respondent which is a Labour Contract Co-operative Society coming under category-ii is entitled to preference over and above the other applications including the petitioner’s application falling under category- iv. It is also relevant to note that the application of the 5th respondent society dated 26.6.2007 was received before the expiry of the existing lease. Hence, there is no bar to treat the same as an application for grant of fresh lease under Rule 12 (2) of the Rules. The genuineness of the said application dated 26.6.2007 made on behalf of the 5th respondent society was confirmed by the District Co-operative Oﬃcer, Guntur and W.P.No.16885 of 2007 ﬁled by a rival group among the members of the 5th respondent society challenging the proceedings of the District Co-operative Oﬃcer has been dismissed by this Court by a separate order passed today. Therefore, as per the preference provided under Rule 12 (2) of the Rules, the 5th respondent society alone is entitled for grant of lease, if it is treated as a fresh lease. For the aforesaid reasons, even assuming that in the absence of any statutory provision, the 1st respondent ought not to have condoned the delay in ﬁling the application for renewal and consequently the lease by way of renewal in favour of the 5th respondent society is illegal, I am of the opinion that the order of the 3rd respondent dated 21.05.2008 granting lease in favour of the 5th respondent society can as well be treated as a fresh lease and therefore warrants no interference by this Court. Since the 3rd respondent, who is the competent authority for granting mining lease, considered the merits and demerits of all the applications received and passed the order dated 21.05.2008 assigning the reasons for granting the lease in favour of the 5th respondent and rejecting the other applications including the application of the writ petitioner, the interference by this Court is not warranted on any ground whatsoever. Accordingly, the Writ Petition, which is devoid of any merit, is hereby dismissed. No costs. _______________ G. ROHINI, J. Dt. 21.10.2008 gbs Note:- (1) CC in 3 days. (B/O) KLP (2) LR copy to be marked. (B/O) gbs [1] AIR 1993 SC 147