IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL Writ Petition No. 165 of 2011 M/S) Rakesh Kumar S/o Shri Amir Singh ..… Petitioner Versus State of Uttarakhand and others ..… Respondents Mr. Arvind Kumar Sharma, Advocate for the petitioner. Ms. Pushpila Bisht, Advocate assisted by Ms. Menka Tripathi, Advocate for the respondents. With Writ Petition No. 591 of 2010 M/S) Sanjay Kumar ..… Petitioner Versus State of Uttarakhand and others ..… Respondents Ms. Pushpila Bisht, Advocate assisted by Ms. Menka Tripathi, Advocate for the petitioner. Mr. Arvind Kumar Sharma, Advocate for the private respondents. With Writ Petition No. 898 of 2010 M/S) Sawraj Karnwal ..… Petitioner Versus State of Uttarakhand and others ..… Respondents Ms. Pushpila Bisht, Advocate assisted by Ms. Menka Tripathi, Advocate for the petitioner. Mr. Arvind Kumar Sharma, Advocate for the respondents. Mr. R.C. Arya, Brief Holder for the State. Hon’ble Tarun Agarwala, J. This group of petitions involves a common issue and, are being decided together. For facility, the facts of Writ Petition No. 165 of 2011 (M/S), Rakesh Kumar Vs. State of Uttarakhand and others is being stated hereunder:- The petitioner is the owner of land in khata No.22, khasra Nos. 6, 7 and 9 measuring 2.915 hectares in village Bhogpur, Tehsil & District Haridwar. The land is adjacent to the river. The petitioner applied for a mining lease on his land. The State Govt. after making due inquiries, granted permission by an order dated 6th May, 2010 to excavate minor minerals from his land in order to make the land agricultural. Based on the said permission, the District Magistrate issued a work order dated 28th May, 2010 on 2 certain terms and conditions. The State Govt. by an order dated 1st September, 2010 cancelled the permission on the ground that a Contempt Application No. 75 of 2010, Maya Dixit Vs. Sri P.C. Sharma, Principal Secretary/Director (Geology and Mining Unit) and others was pending before the High Court. The petitioner, being aggrieved by the cancellation of the permission, has filed the present writ petition contending that no opportunity of hearing or notice was given by the State Govt. before cancelling the permission. The petitioner further contended that he has a preferential right to excavate the minor minerals from his land and that the lease was granted rightly under Chapter II of the Uttarakhand Minor Mineral (Concession) Rules 2001 and that Rule 72 of the Rules contemplated under Chapter VIII of the aforesaid Rules has no application. It was further contended that the judgment dated 27th March, 2010 passed in Writ Petition No. 1498 of 2009, Maya Dixit Vs. State of U.P. and others was not applicable to the facts and circumstances of the case nor the contempt proceedings initiated therein had any bearing with the facts of the case. The learned counsel submitted that in any case, the contempt application has been dismissed by the High Court and, consequently, there was no embargo upon State Govt. to recall its order and allow the petitioner to mine the minerals pursuant to the work order given by the District Magistrate. The State Govt. in its counter affidavit has justified the order of the State Govt. dated 1st September, 2010 contending that the permission granted by the State Govt. was not in accordance with the Rules and, consequently, the State Govt. passed the impugned order which requires no interference in a writ jurisdiction. The learned Brief Holder further submitted that prior to the passing of the order by the State Govt. dated 1st September, 2010, the District Magistrate had issued an order dated 28th June, 2010 cancelling the work order which has not been challenged by 3 the petitioner. The learned Brief Holder submitted that the permission was withdrawn and the work order was cancelled on the basis of the directions issued in Writ Petition No. 1498 of 2009, and that, in any case, the petitioner has an alternative remedy under Rule 78 of the Rules of 2001. An intervention application in this writ petition was filed by Swaraj Karnwal which was allowed by this Court and he was directed to intervene in the matter and address the court. The Court finds that the said Swaraj Karnwal has also filed a separate Writ Petition No. 898 of 2010 praying for the quashing of the permission granted by the State Govt. and the work order issued by the District Magistrate in favour of Rakesh Kumar, the petitioner in Writ Petition No. 165 of 2011 (M/S) and also against the respondent Nos. 6 to 8 who, in similar circumstances, were also granted permission by the State Govt. and work orders were issued in their favour by the District Magistrate. Shri Swaraj Karnwal, in his writ petition, submitted that he is an interested party and was interested in applying for a grant of a mining lease, pursuant to the mining policy of 2001 as amended by the policy of 2002. He was waiting for the issuance of the notification pursuant to which he could apply for the grant of the mining lease but the State Govt. without advertising and without inviting applications from the public has illegally and arbitrarily, in gross violation of the Act and the Rules framed therein, has granted mining permission to the private individuals and, consequently, prayed that the lease executed in their favour should be cancelled. Similar facts have also been stated in Writ Petition No. 591 of 2010, Sanjay Kumar Vs. State of Uttarakhand and others. Interestingly, the stand taken by the State Govt. in Writ Petition No. 898 of 2010 (M/S) and 591 of 2010 (M/S) is contradictory to the stand taken in Writ Petition No. 165 of 2011 (M/S). The State Govt. in Writ Petition No. 898 of 2010 and 591 4 of 2010 have stated that the lease granted to the private individuals was in accordance with Chapter II of the Rules and that there is no requirement to advertise the area before granting the lease. The State Govt. submitted that under Clause 2.5 of the policy of 2002 read with Rule 72 of the Rules, it was clear that Rule 72 only applies for re-grant of a lease and is not applicable where lease is being granted for the first time. The State Govt. has further stated that it has issued a Government Order dated 25th June, 2010 directing all District Magistrates to ensure that in future a mining lease would be issued after due advertisement as per Rule 72 of the Rules. The stand of the petitioner Rakesh Kumar and the private respondents in the connected writ petitions is common, namely, that the lease issued to them was under Chapter II of the Rules and that there was no requirement of prior advertisement and that Rule 72 of the Rules was not applicable. Further, the petitioner in Writ Petition No. 898 of 2010 (M/S) and 591 of 2010 (M/S) has no locus standi and that the writ petition has been filed with an ulterior purpose. In the light of the aforesaid stand taken by the respective parties, the core issue to be considered in this set of petitions is, what is the right of the private individuals who want to mine minor minerals in their own land ? Do these private individuals have any preferential right to excavate minor minerals from their own land ? Are they entitled to get the lease executed in their favour on the mere asking? Is the provision of Chapter II of the Rules available to them in the facts and circumstances of the case? Whether an advertisement is required to be made inviting applications from the public before the authority grants a lease in favour of the private individuals and whether Rule 72 of the Rules is applicable to the case in hand? In order to answer the aforesaid issues, it is necessary to consider the provisions of the Act and the Rules. 5 By virtue of Entry 54 of the Union List to the Seventh Schedule of the Constitution of India, the Parliament enacted the Mines and Minerals (Development and Regulation) Act, 1957 to provide for the development and regulation of mines and minerals under the control of the Union. Section 15 of the Act gives power to the State Govt. to make Rules for regulating the grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals and for purposes connected therewith. In exercise of the powers conferred under this section, the Govt. of Uttar Pradesh made rules known as the Uttar Pradesh Minor Minerals (Concession) Rules, 1963. The State of Uttarakhand was carved out from Uttar Pradesh in the year 2000 and the U.P. Rules of 1963 was adopted with modifications which came to be known as Uttarakhand Minor Minerals (Concession) Rules, 2001 (hereinafter referred to Rules 2001). Chapter II, IV and VI of the Rules of 2001 relates to the grant of mining lease by the competent authority. Under the Rules, mining operations in respect of the mining minerals can be undertaken only in accordance with the terms and conditions of the mining lease or mining permit as the case may be. Under Chapter II, applications for grant of mining lease is provided under Rule 5 in form MM1 and the documents to be enclosed are provided under Rule 6. Rule 8 provides the authorities to dispose of the application. Rule 9 provides for preferential rights when two or more persons apply for a mining lease in respect of the same land. Mining lease can also be granted under Chapter IV by way of auction or tender or by way of auction-cum-tender and the procedure is provided from Rule 23 to Rule 27-B. Under Chapter IV, before a mining lease could be granted, the State Govt. is required to declare the area or areas which are required to be given through a lease and Rule 24 empowers the State Govt. to withdraw any area which had been declared under Rule 23 (1). The said 6 Rule indicates that where an area is withdrawn under Rule 24, then a lease could be granted under Chapter II, III and VI as the case may be. Under Chapter VI, a mining permit can be granted in the manner provided thereunder. Chapter VIII contains the residuary provision. Relevant provisions for the purpose of the case is Rule 67 and 72 which would be dealt hereinafter at an appropriate place. However, in short, Rule 67 provides for payment of compensation to the land owners whose land is used for the mining operations and Rule 72 provides re-grant of a mining lease. Upon the creation of the State of Uttarakhand, the State Govt. issued a mining policy dated 30th April, 2001. In this policy, the entire mining in the State of Uttarakhand was required to be done by the Corporations, namely, the Uttarakhand Forest Development Corporation, Kumaon Mandal Vikas Nigam and Garhwal Mandal Vikas Nigam. The Uttarakhand Forest Corporation was required to do the mining in the forest areas and other two corporations were required to do the mining outside the forest areas. In the mining policy, it was directed that, in the event, the corporations fail to take the mining operations, in that event, it would be given to private individuals. It was also provided that preferential right in the plain areas, which includes the district of Haridwar, would be given to the Corporation under Rule 5 (1) of Chapter II of the Rules of 2001. The State Govt. later on found difficulty in continuing with this mining policy, in as much as, the Corporations, who were authorised to do the mining, were not doing the mining operations in the manner in which the State Govt. wanted. Accordingly, the mining policy was modified on 17th October, 2002 and the mining by the Corporations was confined in the revenue and forest areas and private measurement land was to be settled through a mining 7 lease or permit as the case may be with the prior approval of the State Govt. These mining policies of 2001 as modified by 2002 is as per Section 17A (2) of the Act, 1957. For facility, the said provision is quoted hereunder:- “17A(2) the State Government may, with the approval of the Central Government, reserve any area not already held under any prospecting licence or mining lease, for undertaking prospecting or mining operations through a Government company or corporation owned or controlled by it and where it proposes to do so, it shall, by notification in the Official Gazette, specify the boundaries of such area and the mineral or minerals in respect of which such areas will be reserved.” As a result of the mining policy of 2001 as modified in 2002, the area reserved exclusively for the Corporations stood de- reserved in 2002 and a lease could be granted by the authorities to private individuals. The petitioner Rakesh Kumar and the private respondents in the connected writ petitions are owners of the land which are located near the river. During floods, the land of the petitioner and the private respondents comes under water and, when the water recedes, it leaves behind the fluvial deposits. Section 3 (e) of Act, 1957 defines “minor minerals” as building stones, gravel, ordinary clay, ordinary sand other than sand used for the prescribed purpose and any other minerals which the Central Govt. may, by notification in the Official Gazette, declare to be a minor minerals. Under the Rule 2(7) of Rules of 2001, minor mineral has been defined as under :- “Minor minerals” means building stones, gravel, ordinary clay, ordinary sand other than sand 8 used for prescribed purposes, and any other mineral which the Central Government has declared from time to time or may declare, by notification in the official Gazette, to be a minor mineral, under clause (e) of section 3 of the Mines and Mineral (Regulation and Development) Ac, 1957 (Act no.67 of 1957)” Rule 3 defines that no persons within the State can undertake any mining operations of any minor mineral except under and, in accordance with the terms and conditions of a mining lease or mining permit granted under the Rules. The Act of 1957 and the Rules of 2001 makes it clear that the deposits left on the land by the receding waters belongs to the State Govt. The petitioner cannot undertake any mining operation even on their own land unless a lease or permit is granted to them by the State Govt. Even though the petitioners are owners of the land, they do not have any exclusive right to take out the fluvial deposits from their land unless and until a mining lease is granted by the competent authority to them. The petitioner contends that they have a preferential right under Rule 9 of Chapter II of the Rules. Rule 9 contemplates a different situation, namely, if there are two applications for grant of a mining lease from the same land, in that case, the authority is required to process the two applications in the manner provided under Rule 9. The mere fact that the petitioner is the owner of the land does not give him any preferential right to excavate the deposits left on his land by the receding waters. The petitioner, at best, is entitled to get compensation for the use of its land by the mining lease holder as provided under Rule 67. For facility, the said provision is quoted hereunder:- “No restriction etc. to be imposed by owner of land on mining operation except demand of compensation – (1) 9 No person, who has right in any capacity on the land covered by a mining lease or mining permit, shall be entitled to impose any prohibition or restriction on the mining operations by the holder of such lease or permit of such land or to demand any sum by way of premium of royalty for the removal of minor mineral: Provided that such person shall be entitled to get annual compensation from the said holder of mining lease or permit for the use of surface of the land for mining operations, as may be agreed upon between them. (2) Where the holder of a mining lease or permit and the owner of the surface of the land could not agree upon the amount of annual compensation and a dispute arises in respect thereof, it shall be determined by the District Officer in such manner that: (a) in the case of agricultural land, the amount of annual compensation shall be worked out on the basis of the average annual net income form the cultivation of similar land for the past there year, and (b) In the case of nor agricultural land, the amount of annual compensation shall be worked out on the basis of average annual letting value of similar land for the previous three years.” A perusal of the aforesaid provision makes it apparently clear that the owner of the land is only entitled to get compensation from the holder of the mining lease or permit if the petitioner wants to mine the minor minerals from his own land and is required to apply like any other applicants under the Rules and, consequently, is not entitled for any preferential treatment. In the 10 light of the aforesaid, the petitioner, who is the owner of the land and, in whose land the river leaves behind the fluvial deposits is not entitled to get the lease on the mere asking. The question now is, whether the provision of Chapter II is available to the petitioner. The answer is no. Chapter II and the provisions relating therein are not applicable. Areas were reserved exclusively for mining for the three corporations under the mining policy of 2001 as modified in 2002. The said policies were passed in consonance with the provision of Section 17A (2) of the Act. A perusal of said provision makes it apparently clear that various areas including the areas of District Haridwar were reserved exclusively for the Corporations. In 2002, the mining policy was modified and, it was directed that private measurement land would be settled by a mining lease or a permit to private individuals after prior approval was given by the State Govt. Consequently, in the opinion of the Court once the area has been reserved under Section 17A of the Act, the application for grant of a mining lease would fall under Rule 72 as provided under Chapter VIII of the Rules of 2001. For facility, Rule of 72 is extracted hereunder:- “72. Availability of area for regrant on mining lease to be notified – (1) If any area, which was held under a mining lease under chapter-II or reserved under section 17- A of the Act, becomes available for regrant on mining lease, the District Officer shall notify the availability of the area through a notice inviting for applications for grant of mining lease specifying a date, which shall not be earlier than thirty days from the date of notice and giving description of such area and a copy of such notice shall be displayed on the notice board of his office and shall also be sent to the Tehsildar of such area and the Director. (2) The applications for grant of mining lease under sub-rule (1) shall be received within seven working days from the date specified in the notice referred to in the said sub-rule, if, however, the number of applications received for any area is less than three, the District Officer may further extend the period for seven more working days and if even thereafter, the number of applications remain 11 less than three, the District Officer shall notify the availability of the area a fresh in accordance with the said sub-rule. (3) An application for grant of mining lease for such area which is already held under a lease or notified under sub-rule (1) of rule 23 or reserved under section 17A of the Act and whose availability has not been notified under sub-rule (1) shall be deemed to be premature and shall not be considered and the application fee thereon if paid shall be refunded.” The contention of the petitioner that Rule 72 applies where a lease has been granted earlier and is now up for re-grant is clearly erroneous. The provisions clearly indicates that if any area which was held under a mining lease under Chapter II or was reserved u/S 17A of the Act and becomes available for regrant of a mining lease, in that event, the competent authority would notify the availability of the area for grant of a mining lease. In the present case, the Court finds that the area in question was exclusively reserved for the Corporations u/S 17A (2) and, thereafter, became available for settlement to the private individuals. Consequently, the lease to be granted to the petitioner and the private individuals was required to be done in accordance with the procedure contemplated under Rule 72 of the Rules. In the present case, the petitioners and the private respondents filed an application for grant of a mining lease under Chapter II which was processed and permission was granted and, thereafter, in the case of Rakesh Kumar, the permission was withdrawn and the work order was cancelled. The same was done because the sword of Damocles, namely the contempt petition was hanging over the head of the Principal Secretary. Admittedly, the lease granted to the petitioner and to the private respondents was given without taking course to the provision of Rule 72, namely, without notifying the area for grant of mining lease and without advertising it. Consequently, the Court is of the opinion that the 12 lease granted to the petitioner Rakesh Kumar and to the private respondents, being in gross violation of Rule 72 of the Rules, could not be sustained and are liable to be quashed. The State Govt. was justified in passing the order dated 1st September, 2010 in the case of Rakesh Kumar and the District Magistrate had rightly cancelled the work order by its order dated 28th June, 2010. The lease granted in favour of the petitioner and to the private respondents was patently illegal. In any case, this Court is of the view that the lease or permit, as the case may be, can only be granted after due advertisement and wide publicity, whether the lease is granted under Chapter II, III, IV or VI. The object is that, there should be transparency in the matter of granting a mining lease by the granting authority. The object of advertisement and wide publicity is to bring to the notice of the public at large so that an interested person could apply for grant of a mining lease. In A-One Granites Vs. State of U.P. and others, AIR 2001 SC 1203, an area was declared for mining purposes under Chapter IV of the U.P. Rules of 1963 which is pari materia to Chapter IV of the Rules of 2001. The State Govt. of U.P. then withdrew the area by exercising its power under Rule 24 of the said Rules and invited applications from the public under Chapter II. The Supreme Court held that applications from private individuals without advertising was illegal and unwarranted and that the area was required to be notified and advertised and the applications had to be processed under Rule 72. The Supreme Court held :- “The language used in rule 72(1) on a literal meaning being given, would undoubtedly support the contention of Mr. Das and Mr. Sanghi, appearing for the appellant that this procedure would not apply when the area in question had been held under a lease not under Chapter II but under Chapter IV. But such an interpretation should be avoided inasmuch as the very purpose for which 13 rule 72 has been engrafted in the Rules will totally get frustrated. The object of having such provision is transparency in the matter of granting mining