Judgment :-

Chelameswar, J.

1. By a common judgment dated 4th March, 2002, the High Court of Madras dismissed a batch of writ appeals and some connected writ petitions. Aggrieved by the said judgment, four companies, which are carrying on the business of manufacture and sale of cement in the State of Tamil Nadu, carried the matter to this Court in these appeals.

2. The Government of Tamil Nadu in the Industries Department issued a letter No. 628 dated 10.5.1982 addressed to the Collectors of the various districts. The relevant part of the letter reads –

“I am directed to state that the rates of Royalty and dead rent in respect of leases over patta lands have been fixed at 50% (half rate) as a convention which has been followed for a long time and this is not based on rules.

2. In 1977 in his Audit report, the Senior Deputy Accountant General has pointed out the incorrect levy of royalty at half the rates for mining in patta lands, since no proportion has been prescribed in the Minerals Concession Rules 1960 in regard to the share in the Minerals between the pattadar and the Government. The Senior Deputy Accountant General has also pointed out in his D.O. fourth cited that omission to levy royalty in the state at the mandatory rate for mining patta lands where minerals fully vest in Government resulted in the Government forgoing revenue amounting to Rs.40.28 lakhs on 39.12 lakhs tones of minerals in respect of 29 leases during 1974 to 1976 alone. In pursuance of this audit objection and in consultation with the Director of Industries and Commerce erstwhile Board of Revenue and the Government of Karnataka and Andhra Pradesh, the Government issued orders in their fifth cited the effect that the existing system referred to in para 1 above might be continued for the present.

3. The above order is not a final decision of the Government but it is only tentative order. The share of minerals, to pattadars in respect of inam, manyam and sarvanyam lands may vary with reference to the period and nature of assignments. Further, the Senior Deputy Accountant General has also pointed out that there was heavy loss of revenue to the Government to the tune of Rs.40.28 lakhs in the year 1974-76 due to the levy of half rate of royalty and dead rent prescribed in the second and third Schedules to the Mines and Minerals (Regulation and Development) Act, 1957 in respect of mining leases over patta lands as in the case of Government lands. Accordingly, I am to request you to stop sharing 50% of the royalty and dead rent with the patta land holders in respect of mining leases and to collect the whole amount due as royalty and dead rent prescribed in the second and third schedules to the said Act as in the case of land in which the minerals vest in the Government with effect from the date of issue of this Order.

I am also to state that inamdar and proprietor of the lands permanently settled will be entitled to minerals rights subject to the conditions that the land holder and the inamdar establishes his proportionate rights in the minerals by means of document evidence.”

     Pursuant to the said letter, the Collectors called upon these cement companies to remit royalty and the dead rent at the rates prescribed under the Mines and Minerals (Development and Regulation) Act^[1].

    [1] Footnote The Government in their letter cited have instructed to levy and collect the royalty and Dead Rent in respect of the patta lands leased out for mining purposes at the full rate of Royalty and dead rent prescribed in the Second and third Schedules to the Mines and Minerals (Regulation and Development) Act, 1957, with effect from 10.5.82.

     2. Please therefore remit the royalty and Dead Rent at the rates prescribed in the second and third schedules to the Mines Act and apply for transport permits to the Special Tehsildar – Mines, Tiruchirapalli. The amount of Royalty an