Snndur Manganese & Iron Ores Ltd vs State Of Karnataka & Ors

3) The appellants in these appeals are Sandur Manganese & Iron Ores Ltd. (in short "Sandur") and M/s MSPL Ltd. The principal respondents are M/s Kalyani Steels Ltd. (in short "Kalyani") and M/s Jindal Vijayanagar Steels Ltd. (in short "Jindal"). Apart from these, the State of Karnataka and the Union of India are also arrayed as respondents.

However, NMDC was not granted lease and in 1992, one Sri H.G. Rangangoud was granted 60 Hectares out of the same applied area.

(ii) Again, on 24.06.1993, again the Company applied for grant of lease over an area of 513.16 Hectares within the area deleted from its original lease but it was rejected by the State Government on the ground that the area applied 4 by them has overlapped with the area granted to one Sri Rangangoud and nine others. On 11.12.1993, the Company challenged the above decision of the State Government by filing a Revision Petition before the Government of India, Ministry of Coal and Mines, New Delhi. On 09.04.1999, the Government of India by holding that the order passed by the State Government was in violation of Rule 26 (1) of the Mineral Concession Rules, 1960 (hereinafter referred to as "MC Rules") and opposed to the principles of natural justice remanded the matter to the State Government for early disposal as per the provisions of Mines & Minerals (Development and Regulation) Act, 1957 (hereinafter referred to as the "MMDR Act") and the Rules framed thereunder. On 26/27.02.2002, the Company got a letter from the State Government that out of the area of 513.16 Hectares applied for by it, only an extent of 256 Hectares (640 acres) was available and it could choose either Block A (168 Acres or 67 Hectares) or Block B (472 Acres or 189 5 Hectares).

(iii) On 13.05.2002, the Company filed a revision petition before the Government of India against the said decision of the State Government. On 15.03.2003, the State Government issued a Notification in exercise of its power under Rule 59 of the MC Rules reserving the entire area calling for applications from the general public for grant of mining leases and by notifying large extent of previously held areas as available for grant of mines including the area applied by the appellant-Company. On 16.04.2003, the appellant-Company, by way of abundant caution, applied afresh for grant of mining lease over an area of 200 Hectares in the notified area without prejudice to its rights for consideration of its earlier application dated 24.06.1993. On 29.07.2003, the Government of India allowed the revision petition filed by the appellant- Company and directed the State Government to consider the application dated 24.06.1993 filed by the appellant- Company on merits, in terms of order dated 09.04.1999 of 6 the Revisional Authority and pass a final order in the case. In spite of this order, the State Government has not passed any order. On 06.12.2004, a letter was issued by the State Government seeking approval of the Central Government for grant of lease to other applicants i.e. Jindal & Kalyani. Being aggrieved by the said recommendation, on 11.06.2007, the appellant-Company filed Writ Petition No. 8971 of 2007 before the High Court. The learned single Judge clubbed this writ petition along with W.P. No. 21608 of 2005 filed by another applicant - MSPL Ltd. On 07.08.2008, the learned single Judge quashed the Notification dated 15.03.2003 and the Mining Licences granted in favour of Jindal and Kalyani with certain observations.

(iii) On 13.05.2002, Sandur filed a revision before the Central Government under Rule 54 of the MC Rules 9 challenging the proposal of the State Government dated 30.08.2001, in favour of the MSPL. During pendency of the said revision, Sandur also filed W.P. No. 22767 of 2002 seeking a mandamus to the Central Government to consider its revision petition. On 24.10.2002, Jindal made an application for grant of mining lease over a part of the same area previously held and surrendered by Sandur. On 15.03.2003, the State Government issued Notification informing the general public that the areas mentioned in the annexure thereof were available for grant under Rule 59 of the Rules and interested persons were requested to file applications for grant of mining leases. On 16.04.2003, pursuant to the said notification, MSPL made an application for the same area previously held by Sandur. On 29.07.2003, the Central Government rejected the revision petition of MSPL. On 20.12.2003, MSPL made further submissions before the Mines Director. On 30.04.2004, the respondent-Mines Director sent a notice to the MSPL for making submissions. Again on 10 06.10.2004, the Under Secretary to the new State Government, Mines (C & I Department) issued another notice under Rule 26(1) of the Rules requiring the MSPL to appear before the Hon'ble Chief Minister of Karnataka to make a presentation for sanction of lease. MSPL put-forth its claim and submitted a detailed presentation to the Principal Secretary to the Chief Minister. Vide letter dated 06.12.2004, the State Government sought the approval of the Central Government under Section 5(1) of the MMDR Act to grant lease to Jindal over an area of 200.73 Hectares and Kalyani over an area of 179.70 Hectares in respect of a part of the land mentioned in S.No.1 to the Notification dated 15.3.2003. On 15.12.2004, MSPL made representations both to the Minister for Mines and to the Secretary, Department of Mines in the Central Government against the said proposal. On 21.12.2004, a further representation was made to the Secretary, Department of Mines. Against the said approval, two others preferred writ petitions before the High Court for 11 quashing of the said proposal. MSPL filed application for impleadment in the said writ petitions and the same was rejected by the learned single Judge vide order dated 21.07.2005.

(iv) On 12.09.2005, MSPL preferred writ petition being W.P. No. 21608 of 2005 before the High Court challenging the recommendation in favour of Jindal and Kalyani. On 05.06.2006/27.06.2006, the Central Government granted approval to the recommendation dated 06.12.2004 of the State Government for grant of mining lease in favour of Jindal and Kalyani. Vide judgment dated 07.08.2008, learned single Judge of the High Court allowed W.P. No. 21608 of 2005 quashing the recommendation. Against the judgment of the learned single Judge, Jindal and Kalyani preferred W.A. Nos. 5026 & 5028 of 2008 respectively, before a Division Bench of the High Court. MSPL also filed W.A. No. 5057 of 2008 challenging the same judgment of the learned single Judge save and except to the extent that the recommendations of the State 12 Government to the Central Government insofar as it recommended the grant of mining to Jindal and Kalyani was quashed. A large number of other writ appeals were also filed, heard together and disposed of by a common judgment and order dated 05.06.2009.

11) The materials placed further show that on 15.03.2003, the State Government issued a Notification under Rule 59(1) of the MC Rules notifying the availability of a large area for re-grant of mining lease which was referred to as the "Held Area Notification". Pursuant to the same, MSPL made a fresh application on 16.04.2003 for grant of mining lease over the notified area. Kalyani and 88 other applicants also applied pursuant to the said Notification. Admittedly, Jindal did not apply pursuant to 22 the "Held Area Notification", even though some of its sister concerns applied for the grant. On 06.12.2004, the State Government made a recommendation to the Central Government under Section 5 of the MMDR Act for approval of the proposed grant of mining lease to Jindal and Kalyani. MSPL and some of the applicants made representations to the Central Government against the said recommendation made by the State Government. Challenging the recommendation dated 06.12.2004 of the State Government, writ petitions were filed by the aggrieved companies before the High Court. During the pendency of the writ petitions, the Central Government gave its approval for grant of mining lease in favour of Jindal and Kalyani on 05.06.2006 and 27.06.2006 respectively. By judgment dated 07.08.2008, the learned single Judge allowed the writ petitions filed by MSPL and Sandur as well as others and quashed the grant on the ground among others, that Jindal's application prior to the "Held Area Notification" could not have been 23 entertained in view of Section 11(4) of the MMDR Act and Rules 59 and 60 of the MC Rules. The Division Bench, by judgment and order dated 05.06.2009, reversed the judgment passed by the learned single Judge. With this background, let us discuss the issues formulated above. Issue (a) "Whether the State Government's recommendation dated 06.12.2004 and the proceedings of the Chief Minister are contrary to the provisions of Section 11 of the Act and Rules 59 and 60 of MC Rules and not valid in law."

Issue (f):

74 Issue (h):

If such premature applications are allowed to be entertained, it would result in the State Government giving out mining leases to favoured persons without 76 notice to the general public.

Issue (i):

Conclusion:

58) All the appeals are allowed to the extent mentioned above. No costs.

SEPTEMBER 13, 2010.