Case: Nookala Setharamaiah Vs. Kotaiah Naidu &amp; Ors

I am directed to refer to your application dated the 8th December, 1955, on the subject and to say that after careful consideration of the facts stated therein, the Central Government have come to the conclusion that there is no valid ground for interfering with the decision of the Government of Hyderabad, rejecting your application for grant of mining lease for iron ore in Appalanarasimhapuram and Raigudam villages, Khammameth district. Your application for revision is, therefore, rejected.        Yours faithfully,        Sd/G. C. Jerath,to the Government of India."9. Evidently the Central Government proceeded on the basis that the order of the State Government dated January 9, 1954 granting 57 acres and 20 cents of land to the 1st respondent, by implication amounted to a rejection of his claim in respect of the other areas.        10. Meanwhile on September 15, 1956, some of the rules were amended. After Rule 28 tabindex = 1>28e 28 tabindex = 1>28) was inserted. That"Every application under Rule 27 shall be disposed of by the State Government within 9 months from the date of receipt of the application."At the same time Rules 57 was also amended. Amended Rule 57 reads thus:"Application for review.(1) Where a State Government passes as under:(i) refusing to grant a certificate of approval, prospecting license or mining lease;        (ii) refusing to renew a certificate of approval, prospecting license or mining lease;        (iii) cancelling a prospecting license of mining lease;        (iv) refusing to permit transfer of a prospecting license or any right, title or interest therein under Clause (iv) ofe (1) of Rule 23 or a mining lease or any right, title or interest therein under Rule 37, it shall communicate in writing the reasons for such order to the person against whom the order is passed and any person aggrieved by such order may, within two months of the date of receipt of such order, apply to the Central Government for reviewing the same.        (2) Where a State Government has failed to dispose of an application for the grant or renewal of a certificate of approval or prospecting license or a mining lease within the period prescribed therefor in these Rules, such failure shall, for the purpose of these rules, be deemed to be a refusal to grant or renew such certificate, license or lease as the case may be, and any person aggrieved by such failure may, within two months of the expiry of the period aforesaid, apply to the Central Government for reviewing the case.        (3) An application for review under this rule may be admitted after the period of limitation prescribed under this rule, if the applicant satisfies the Central Government that he had sufficient cause for not making the application within the said period."11. A further amendment to that Rule 57 (2) was made on August 31, 1957. The concerned notification No. S. R. O. 2753 reads:"In exercise of the powers conferred by Section 5 of the Mines and Minerals (Regulation and Development) Act, 1948, the Central Government hereby makes the following further amendment in the Mineral Concession Rules, 1949, namelyProvided that any such application pending with the State Government on the 14th September, 1956, and remaining undisposed of on the 24th August, 1957, shall be disposed of by the State Government within six months from the latter date."12. On April 16, 1957, the 1st respondent filed another review petition before the Central Government. On September 26, 1957, that petition was dismissed by the Central Government as being premature. The relevant portion of that order reads:"With reference to your application dated 16th April, 1957, on the above subject, I am directed to invite your attention to this Ministrys notification No.7 dated the 21.8.57 (copy enclosed) amending the Mineral Concession Rules, 1949. It will be noticed therefrom that the application for concessions received by the State Government prior to the 4th September, 1956 and remaining undisposed of on the 31st August, 1957 shall be disposed of by them within six months from the latter date. Your application for review is therefore premature at this stage and in case your application for Mining Lease is not disposed of by the State Government within the prescribed period you may apply to the Central Government at the appropriate time."13. While making this order, evidently the Central Government had overlooked its earlier order dated July 18, 1956.        14. After the aforementioned order of the Central Government, the 1st respondent moved the High Court of Andhra Pradesh under Article 226 of the Constitution in Writ Petition No. 888 of 1957 seeking a writ of mandamus to the State Government of Andhra Pradesh to dispose of his application for lease made on September 15, 1953, expeditiously. To that petition he made only the State of Andhra Pradesh as the respondent. Neither the Central Government nor the appellant herein were parties to that petition. That petition came up for hearing before Basi Reddy, J., on November 4, 1958. At the hearing the learned Government Pleader who appeared for the State Government conceded that the application of the petitioner for mining lease on September 15, 1953 had not been disposed of by the State Government in the manner prescribed by R. 17 of the Rules but he contended that that application must be deemed to have been rejected in view of Rule 57 (2). The learned Judge rejected that contention with the following observations:"In my opinion this deeming provision is intended for the benefit of the applicant and does not relieve the State Government from performing the statutory functions imposed on it by Rules 17 (1) and 17 (2) viz., of granting or refusing the Licence, and in case of refusal of recording in writing the reasons for the refusal and of refunding the application fee."15. He accepted the petition and issued the mandamus prayed for.        16. During the pendency of the writ petition No. 888 of 1957, the 1st respondent filed another writ petition on December 16, 1957 seeking the very relief that he had sought in his earlier writ petition. That petition was disposed of by Bhimasankaran, J., on August 20, 1959, with these observations:"It is stated by the Learned 3rd Government Pleader that the Government is prepared to dispose of the application of the petitioner on the merits without relying upon Rule 57 (2) of the Mineral Concession Rules, 1949. In the circumstances the petitioner does not want to press his petition. The writ petition is accordingly dismissed. There will be no order as to costs."17. The State Government by its order dated May 27, 1961, granted on mining lease to the respondent all the areas for which he had applied on September 15, 1953 less those areas which had been earlier leased out to others.        18. Aggrieved by the above order, the appellant moved the Central Government under Rule 57 on July 7, 1961, for reviewing the said order. Even before that he had moved the Andhra Pradesh High Court under Article 226 of the Constitution on June 13, 1961 to issue a writ of mandamus to the State Government to consider his application for mining lease in preference to that of the 1st respondent as according to him the 1st respondents application should be deemed to have been rejected under Rule 57 (2). The High Court rejected that application observing that the appropriate course for him was to move the Central Government under rule 57 against the order of the State Government. Thereafter on, the Central Government allowed the review petition filed by the appellant and set aside the grant made in favour of the 1st respondent on May 27, 1961. It came to the conclusion that the applications made by the appellant, the 1st respondent as well as others which were pending before the Andhra Pradesh Government should be deemed to have been rejected on the 1st March 1958, in view of R. 57 (2). Aggrieved by that order the 1st respondent filed Writ Petition No. 464 of 1965 praying that the High Court may be pleased to call for the relevant records from the Central Government by issuing a writ of certiorari and quash the order of the Central Government and issue a further writ to the Central Government and to the Stage Government to grant the lease asked for by him. During the pendency of that petition the appellant filed Writ Petition No. 602 of 1965 seeking a writ of mandamus against the Central Government and the State Government to grant him the mining lease for which he had applied. The High Court has allowed the writ petition filed by the 1st respondent and dismissed that of the appellant. Hence these appeals.

Reasoning:
19. So far as Civil Appeal No. 2122 of 1969 is concerned there is no merit in the same. No ground in support of that appeal was urged before us. Hence it fails and it is dismissedWe shall now proceed to consider the correctness of the reasons given by the High Court in support of its order21. The High Court was of the opinion that Rule 57 (2) was enacted only for the benefit of the applicants for lease, license etc., so that they may have an early opportunity to move the Central Government for appropriate orders. In the view of the High Court that rule does not take away the power of the State Government to dispose of the applications made for mining lease etc., even after the period prescribed expires. In support of this conclusion, it relied on the decision of the Patna High Court in Dey Gupta and Co. v. State of Bihar, AIR 1961 Pat 487   as well as on the decision of Basi Reddy, J., in Writ Petition No. 888 of 1957 to which reference has already been made. Neither the Patna decision nor the judgment of Basi Reddy, J., nor the decision under appeal gives any cogent reason in support of the conclusion that the deemed dismissal under Rule 57 (2) does not take away the right of the State Government to grant the lease asked for. The Patna High Court in support of its conclusion observed:"No doubt, readingRule28 tabindex = 1>28) withRule57 (2) of the, it is clear that, if the State Government fails to dispose of an application for the grant of a mining lease within nine months, it must be deemed to have been refused by itBut this provision is made, in my opinion, only for the purpose of filing a review application before the Central Government, so that an applicant desirous to have a mining lease may not have to wait unnecessarily for a long period without any order being passed on his application. That however, does not mean that after the lapse of nine months from the date of receipt of the application, the State Government ceases to have jurisdiction over the matter so as not to pass any order on any application after the lapse of nine months from the date of its receiptThe expression "deemed to be a refusal" inRule57 (2) is only for the purpose of a review application to be filed before the Central Government, and it is not a part of R.28 tabindex = 1>28. In this view of the matter the legality of the order passed by the State Government granting a mining lease to respondent No.2 cannot be challenged on the above ground."22. We think that these observations are not correct. If it is otherwise, even when a review petition is pending before the Central Government underRule57, the State Government can make an order on the application made and thus compel the parties to file another review petition. Further, if the Central Government gives one direction in the review petition and the State Government passes an inconsistent order in the original petition, there is bound to be confusion.If we readRule28 tabindex = 1>28) and7 (2) together, there is hardly any doubt that after the period prescribed, the State Government is incompetent to deal with the applications pending before it. According to rule 57 (2), where a State Government has failed to dispose of an application for the grant of a mining lease within the period prescribed therefor in the rules, such failure shall for the purpose of the rules be deemed to be refusal to grant the lease. The rules referred therein includeRule28 tabindex = 1>28as well. This deemed refusal, if read with the mandate given to the State Government underRule