Case: Gujarat Pottery Works Vs. B. P. Sood, Controller Of Mining Leases For India &amp; Ors

3. The facts leading to this appeal are as follows. Jairam Jagmal originally held a perpetual lease from Chimanlal Chandulal Jani and others, inamdars and owners of the mineral rights for excavating white clay from the area leased and for taking it away. The lessors entered into an agreement for executing the perpetual lease, on December 2, 1939. They did not however, execute the lease, though possession over the leasehold land had been delivered to the said Jairam Jagmal after the execution of the agreement. Ultimately, the lease was executed on November 3, 1951, in execution of a decree of a civil Court for the specific performance of the agreement to lease.4. The original lessee, Jairam Jagmal, transferred his right, title and interest in the lease to the appellant in 1954. On September 29, 1960, the Controller of Mines modified the terms of the lease after following the procedure laid down for modifying the lease under the 1956 rules which continued to be in force in view of S. 29 of the Mines and Minerals (Regulation and Development) Act, 1957, hereinafter called the 1957 Act. The modifications were that the period of the lease was reduced to 25 years from December 2, 1939 and further renewal was to be regulated in accordance with the law and rules in force. Dead rent was payable at the rate of Rs. 10 per acre per annum. The lease was made further subject to the rules made or deemed to have been made under Ss. 13 and 18 of the 1957 Act and royalty was to be payable in accordance with S. 9 of that Act.5. The appellant preferred a revision before the Central Government under R. 7. That was rejected.

Reasoning:
11. We are, therefore, of opinion that the lease in favour of Jagmal was really granted in December 1939 and that the execution of the lease in November 1951 was only to give a formal shape to the lease granted much earlier. The lease in suit, therefore, is a lease which comes within the expression existing mining lease within R. 2 (c) of the 1956 rules.Rule 9 provides for the payment of compensation to the lessee where the area of an existing mining lease is reduced, the amount of compensation being determined in he manner and in accordance with the principles set out in R. 10.Clause (ii) of sub-r. (2) of R. 10 provides that in determining the compensation payable under the rule, the Controller and the tribunal will have regard to the fact that no compensation shall be payable in respect of the reduction of the period of the lease or any modification in the amount of royalty. It is, therefore, that no compensation had been allowed or had been paid to the appellant for the modification in his lease with respect to the reduction of the period of the lease from perpetuity to 25 years and the royalty being payable in accordance with the provisions of the Act.The expression to win interpreted in the English cases was in respect of the context of the expression used in certain leases. The expression winning in a Constitutional provision like Art 31A (1) (e) should be given a wider meaning as the Constitution-makers would be using it to cover cases which deal with the obtaining of minerals and in that case that wider meaning would be to get or extract the mineral from the mine. The object of the Constitutional provision was to make the law providing for the extinguishment or modification of a lease, etc, in connection with mineral rights immune from the provisions of Arts. 14, 19 and 31. There could be no logical reason for not to cover the leases which allowed the working of the mines after the minerals in the mines had been won, in the narrow sense, i.e., the making of such arrangements which would allow the working of the mine. Modifying the provisions of any lease merely for making arrangements for the working of the mine could not be effective in making the law free from the requirements of the various minerals in the public interest. Modification of the leases governing the working of the mines could be necessary for the public interest. Section 2 of both the 1948 and the 1957 Acts declared that it was expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals to the extent thereinafter provided.18. We are, therefore, of opinion that the expression winning in Art. 31A (1) (e) be construed to mean getting or extracting minerals from the mines and other incidentalthe context of the Acts and Rules, the Legislature or the rule-making authority had to use all possible expressions for the purposes of the mining leases so that all conceivable types of mining leases could be covered by the provisions of the enactment and the rules. Mining lease, according to S. 3, C1. (d) of the 1948 Act, means a lease granted for the purpose of searching for, winning, working, getting, making merchantable, carrying away or disposing of minerals or for the purposes connected therewith and includes an exploring or a prospecting license. The definition is very comprehensive and is with the object indicated earlier.20. It is significant to notice that the expression mine, according to C1. (b) of S 3, means any excavation for the purpose of searching for or obtaining minerals. Here the word obtain is used to cover the various processes necessary to get the mineral and would include the processes covered by the expressions winning, working, getting, etc.21.Mining lease, according to R. 3 (i) of the 1949 rules, means a lease to mine, quarry, bore, dig and search for, win, work and carry away any mineral specified therein. This definition of the mining lease does not cover all the purposes mentioned in S. 3 (d) of the 1948 Act. The definition deals with such matters which are covered by the rules, as a mining lease is defined for the purposes of the rules.22. Rule 41 (1) (ii) of the 1949 rules readsany mineral not specified in the lease is discovered in the leased area he shall not win and dispose of such mineral without obtaining a leaseis clear that the word win here includes the getting of the mineral as it is only thereafter that the lessee can dispose of it.23. Section 3 (c) of the 1957 Act defines mining lease to mean a lease granted for the purpose of undertaking mining operations and includes a sub-lease granted for mining operations.24. It follows that the various definitions in the Act or in the rules referred to above are for a limited purpose and that the word winning or win does not always have the same content, and that, therefore, they cannot be any guide for construing the word winning in the Constitutional provision of Art. 31A (1) (e).25. We, therefore, hold that the lease in suit is a lease for the purpose of winning coal and comes within Art. 31A (1) (e) of the Constitution and that, therefore, the rules for the modification of any rights acquiring under this lease cannot be deemed to be void on the ground that they take away the rights conferred by Arts. 14, 19 or 31 of the Constitution.Besides these entries, Entry No. 54 of List I was Regulation of mines and mineral development to the extent to which such regulation and development under the control of the union is declared by Parliament by law to be expedient in the public interest. The 1956 rules were made in connection with the regulation of mines and for the development of minerals and the Central Legislature was competent to provide for the making of such rules by the 1948 Act. The rules do not come within the field of acquisition and requisitioning of property. We do not consider this contention for the appellant to beif the rules were not consistent with the provisions of the 1948 Act and were therefore, void, we do not agree that they could not have continued after the enforcement of the 1957 Act. Section 29rules made or purporting to have been made under the Mines and Minerals (Regulation and Development) Act, 1948, shall, in so far as they relate to matters for which provision is made in this Act and are not inconsistent therewith, be deemed to have been made under this Act as if this Act had been in force on the date on which such rules were made and shall continue in force unless and until they are superseded by any rules made under thiseffect of this section is that the rules which were made or purported to have been made under the 1948 Act in respect of matters for which rules could be made under the 1957 Act would be deemed to have been made under the 1957 Act as if that Act had been in force on the date on which such rules were made and would continue in force. The Act of 1957 in a way is deemed to have been in force when the modification rules were framed in 1956. The 1956 rules would be deemed to be framed under the 1957 Act and, therefore, their validity and continuity depends on the provisions of the 1957 Act and not of the 1948 Act.We agree with this contention. The period of the lease is to be brought in conformity with the provisions of the Act for future and the period for which a lease can be granted is not to exceed 20 years. The Act is concerned for the regulation of mines subsequent to its enactment and has nothing to take into consideration with what has taken place earlier. As a new lease is granted after the enforcement of the Act and can run upto 20 years, there is no reason why the term of an existing lease for mining be not so modified as to make it run upto 20 years after the enforcement of the Act.We therefore accept the contention for the appellant and hold that the Controller was in error in limiting the period of the lease to 25 years from December 2, 1939. The period of the lease could be limited to a period of 20 years commencing from June 1, 1958, the date notified as the date on which the 1957 Act came into force.