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2010 Supreme(SC) 316

Supreme Court of India
THE HONOURABLE MR. JUSTICE P. SATHASIVAM & THE HONOURABLE MR. JUSTICE R.M. LODHA
State of Jharkhand & Others
Versus
M/s. Misrilall Jain & Sons & Anr. etc.etc.
CIVIL APPEAL NOS. 3226-3271 OF 2010 (Arising out of SLP(C) Nos. 2448924534 of 2007) WITH CIVIL APPEAL No. 3272 OF 2010 (Arising out of SLP(C) No. 7199 of 2008) CIVIL APPEAL Nos. 3274-3275 OF 2010 (Arising out of SLP(C) Nos. 7200-7201 of 2008) CIVIL APPEAL No. 3273 of 2010 (Arising out of SLP(C) No. 7202 of 2008) CIVIL APPEAL Nos. 3276-3277 of 2010 (Arising out of SLP(C) Nos. 72037204 of 2008)
Decided on : 13-04-2010

Advocates appeared:
For the Appellants:M.S. Ganesh, Sr. Advocate, Anil Kr. Jha, Manoranjan Kr. Jha, S.K. Singh, K. Seskachary, Gopal Prasad, Advocates. For the Respondents:A.K. Ganguly, C.S. Vaidyanathan, Dr. G.C. Bharuka, S. Ganesh, S.B. Sanyal, Jagdeep Dhankhar, Sr. Advocates, Rajendra Singhvi, Anand Sen, Kaushal K.L. Gautam, Rohan Thwani, R.N. Karanjawala, Manik Karanjawala, Ms. Nandini Gore, Debmalya Banerjee, Ms. Sonia Nigam, Kartik Bhatnagar, M/s. Karanjawala & Co., Devashish Bharuka, Rishad Chowdhury, Shakurlal Agarwal, U.A. Rana, Ms. Mrinal Majumdar, Ms. Devina Shagal, Subhro Sanyal, S.K. Choudhary, Avinish Kumar, Sunil
K. Jain, Aneesh Mittal, Ajay K. Bhatia, Anip Sachthey, Mohit Paul, Shagun, Sherin Daniely, O.P. Bhandani, Brij Bhushan, Arijit Mazumdar, R.P. Goyal, Advocates.

Headnote:Mines and Minerals (Development and Regulation) Act, 1957 - Section 13(2)(i) - Mineral Concession Rules, 1960 - Rule 27(1)(d) and Part-V, Clauses (2) and (4) -Jharkhand Minor Mineral Concession Rules, 2004 - Rule 29(1)(d) - Demand notice issued by appellant-State for payment of enhanced surface rent-There was no challenge by writ petitioners to legislative competence of Parliament to enact 1957 Act or to competence of Central Government to make 1960 Rules or to competence of State Government to make 2004 Rules-By impugned judgment High Court pronounced that imposition of surface rent (whether for major or minor minerals) is beyond legislative competence of State and subordinate/delegated legislative competence and executive authority of State Government-Impugned resolution issued by State Government as an executive order-Certain irrelevant aspects taken into consideration by High Court - Controversy relating to impugned resolution and demand notices needs to be considered afresh by High Court-Writ petitions restored to file of High Court for fresh disposal.

       (Paras 8, 9, 11, 12 and 13)

Judgment :-

R.M. Lodha, J.

Leave granted.

2. In this group of 52 appeals by special leave, 46 are directed against the common judgment dated May 7, 2007 passed by the High of Jharkhand disposing of 46 writ petitions. The remaining 6 arise from separate judgments but following the judgment dated May 7, 2007. These appeals involve common issues and, accordingly, were heard together and are being disposed of by this common order.

3. The appellants in these appeals are State of Jharkhand and their officers (for short, `State Government'). The respondents are major mineral lease holders and minor mineral lease holders (for short, `lessees').

4. On June 17, 2005, the State Government through Department of Mines and Geology issued a Resolution regarding collection of surface rent on the area of mining leases at par with the land under commercial use whereby and whereunder the following decisions were taken:

"(a) The area held for minor and major mineral mining lease shall be treated as held for commercial purposes in accordance therewith the surface rent shall be collected on it.

(b) The annual land rent for the entire area held under minor and major mineral shall be equal to the 5% of the latest market price determined for that particular area by the Dy. Commissioner-cum-District Registration (should be Registrar) and it shall be collected by the District/Asst. Mining Officer from the lease holders.

(c) This rate shall be variable from time to time in proportion of the market price determined by the Dy. Commissioner-cum-District Registrar.

(d) The arrear of the surface rent can be realized by initiating case for auction as a public under the Bihar & Orissa Public Demand Recovery Act, 1914."

5. In pursuance of the aforesaid Resolution, demand notices were issued to the lessees in respect of the leases held by them for payment of enhanced surface rent, i.e., surface rent equal to 5% of the latest market price of the land treating the entire leased area as having been held for commercial use. The lessees approached Jharkhand High Court by filing writ petitions challenging the competence and authority of the State Government in issuing the said Resolution treating entire land for the purposes of determination of surface rent as the lease for commercial purposes and revising surface rent at 5% of the latest market price of the land. The lessees prayed for quashing the Resolution dated June 17, 2005 and demand notices.

6. The State Government defended their action as valid, legal and justified. According to State Government, the Resolution dated June 17, 2005 has been issued in terms of the power conferred upon them, insofar as major minerals are concerned, under the Mines and Minerals (Development and Regulation) Act, 1957 (for short, `1957 Act') and Mineral Concession Rules, 1960 (for short, `1960 Rules') and as regards minor minerals under Jharkhand Minor Mineral Concession Rules, 2004 (for short, `2004 Rules').

7. The High Court by a common judgment dated May 7, 2007, allowed 46 writ petitions and quashed the Resolution dated June 17, 2005 and the demand notices. The other 6 writ petitions were allowed subsequently by following the judgment dated May 7, 2007.

8. Mr. M.S. Ganesh, learned senior counsel for the State Government invited our attention to Entry 54 of Union List and Entry 18, Entry 23 and Entry 45 of the State List in Seventh Schedule to the Constitution. He referred to the provisions of 1957 Act, particularly, definition of `mining lease' and `mining operations' in Section 3(c) and Section 3(d) respectively, Section 13 that empowers Central Government to make rules in respect of minerals, Section 15 that empowers State Government to make rules in respect of minor minerals and Section 17 that specially empowers the Central Government to undertake prospecting or mining operations in certain lands. He also invited our attention to 1960 Rules, particularly, Rule 27 (1)(d) and Rule 31. In backdrop of the aforesaid legal provisio














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