M/S. Pallava Granite Industries ... vs Union Of India And Others

For the sake of clarity we reproduce herein the facts in the case concerning M/s. Rita Industrial Corporation Ltd. __ Appellant in C.A. Nos. of 2006 @ S.L.P. (C) Nos.20225-28 of 2005, they are as follows:

Being aggrieved by the judgment, the State Government preferred Writ Appeal No.672 of 1997. Pending the said writ appeal, the Collector, District Prakasam, wrote to the Director of Mines and Geology stating that in view of the judgment dated 18.10.96 he had no objection to the grant of mining lease to the extent of Acs.15 in terms of G.O.No.1290. Similarly, by letter dated 18.2.97 addressed by Deputy Director of Mines and Geology to Director of Mines and Geology, a request was made to consider the mining lease application filed by M/s. Rita Industrial Corporation Ltd. in terms of the judgment of the learned single judge dated 18.10.96. In the said letter, the Dy. Director has stated that since the Collector, District Prakasam, had allotted the land lease to M/s. Rita Industrial Corporation Ltd. there could be no objection to grant quarry lease over an extent of Acs.15 in Survey no.55/5. Along with the said letter dated 18.2.97 an inspection report was enclosed. This inspection report was prepared by Dy. Director of Mines and Geology. In the said inspection report it was stated that in terms of the judgment of the learned Single Judge dated 18.10.96 the Collector had handed over the lands to M/s. Rita Industrial Corporation Ltd.; that the Collector had agreed to grant the land lease and, therefore, till the judgment dated 18.10.96 remains in force, M/s. Rita Industrial Corporation Ltd. had a right to obtain a mining lease. Accordingly, the Dy. Director requested the Director of Mines and Geology to take a decision on the quarry application of M/s. Rita Industrial Corporation Ltd. at the earliest. A survey report was also annexed with the letter dated 18.2.97 in which it was recited that the Dist. Collector had given N.O.C. for the grant of quarry lease and, therefore, the application made by M/s. Rita Industrial Corporation Ltd. for grant of quarry lease may be disposed at the earliest.

Accordingly, a show cause notice was issued by the State Government on 21.2.98 to the appellants. That show cause notice was challenged vide Writ Petition No.6098 of 1998. Pending the said writ petition, the State Government issued G.O.Nos.267 and 268 on 27/29.9.97 under Rule 9-A(1) of the Andhra Pradesh Minor Mineral Concession Rules, 1966 (for short, "the 1966 Rules"). Under the said G.Os. the State Government, after examination of the report of the Director of Mines and Geology, ordered that an area admeasuring Acs.61.50 in Survey no.55/5 shall be reserved for exploitation by Andhra Pradesh Mineral Development Corporation Limited which is a State-owned Corporation (for short, "APMDC"), in public interest.

These G.O.Nos.267 and 268, however, were issued without prior approval of the Central Government under Section 17A(2) of the Mines and Minerals (Regulation and Development) Act, 1957 (for short, "the 1957 Act"). These G.O.Nos.267 and 268 were challenged by filing writ petitions mainly on the ground that they were invalid as prior approval of the Central Government was not obtained. These writ petitions were filed in October 1997. On 24.10.97 pending the writ petitions the State Government sought approval of the Central Government stating that APMDC is a State-owned company, set up to acquire mining rights from the Government; that the Corporation is a profit making organisation; that the Corporation is equipped with expertise and machinery to undertake mining in a scientific manner; that the State Government had identified Acs.61.50 in Survey no.55/5 for exploitation of galaxy granite and accordingly the Central Government was asked to grant its approval under Section 17A(2) of the 1957 Act. By letter dated 23.7.99, the Central Government enquired from the State Government whether there existed any order of injunction from the competent court in the pending writ petitions. Ultimately, the Central Government vide letter dated 29.10.99 gave its approval for reservation of Acs.61.50 of granite bearing area in Survey no.55/5 out of the total area of Acs.86.50 subject to two conditions, namely, that the reservation shall not be applicable to areas held under mining or quarry lease; and secondly, that the approval granted shall be subject to the outcome of pending court cases.

In terms of the said approval the State Government on 14.2.2002 issued G.O.No.72 (later on published in the Official Gazette of A.P. as Notification No.88 dated 26.2.97). By the said G.O.No.72 an area admeasuring Acs.61.50 was declared as granite bearing area. In the said G.O.No.72 there is a reference to the approval granted by the Government of India. The said G.O. further stated that it was issued without prejudice to G.O.Nos.267 and 268 dated 27/29.9.97.

By judgment and order dated 28.3.2002, the learned Single Judge set aside G.O.Nos.267 and 268 on the ground that prior approval of the Central Government was not obtained. Accordingly, the show cause notice dated 21.2.98 was also set aside. The Court further held that the State Government did not disclose to the Central Government the fact that the appellants were holding leases which were the subject-matter of the pending writ petitions in the High Court and consequently the State Government had violated the above two conditions imposed by the Central Government in its approval dated 29.10.99. Consequently, the learned Single Judge held that the orders cancelling the land leases and the decision to reject the applications for grant of mining leases, was illegal and accordingly set aside the decision of the State Government rejecting the applications made for grant of mining leases. By the said decision the State Government was directed to consider the mining lease applications afresh and dispose of the same in accordance with law.

Being aggrieved by the decision of the learned Single Judge, the State Government went in writ appeal to the Division Bench. By impugned judgment dated 24.3.2004, the Division Bench after reciting the above facts and after taking into account the arguments advanced before it held that it was totally unnecessary to examine the validity of G.O.Nos.267 and 268 respectively since vide subsequent decision dated 29.10.99 the Central Government had granted approval for reserving an area admeasuring Acs.61.50 as granite bearing area. Since the Central Government had granted approval the subsequent G.O.No.72 dated 14.2.2002 cannot be faulted. By the aforestated judgment the Division Bench took the view that G.O.No.72 dated 14.2.2002 was issued after obtaining prior approval from the Central Government and, therefore, the said G.O. did not suffer from any legal or constitutional infirmities. The Division Bench further held that the decision to cancel G.O.No.1290 was valid; that the reservation of an area admeasuring Acs.61.50 was in public interest and that there were no mala fides in cancelling G.O.No.1290 as alleged by the appellants.

By judgment and order dated 27.6.97, the Division Bench disposed of the above-mentioned Writ Appeal No.672 of 1997 stating that there was no infirmity in the judgment of the learned Single Judge dated 18.10.96; that, there was violation of the rules of natural justice inasmuch as the decision to cancel G.O.No.1290 was taken without hearing and without giving reasons and was therefore void and accordingly the writ appeal was dismissed. However, it was made clear by the Division Bench that its judgment and order dated 27.6.97 will not prevent the Government from taking steps to cancel G.O.1290, if such right exists in the Government, in accordance with law.

The short question which needs to be answered is: