2015 Supreme(SC) 210

SUPREME COURT OF INDIA
Fakkir Mohamed Ibrahim Kalifulla, Shiva Kirti Singh, JJ.
M/s. Muneer Enterprises – Appellant
Versus
M/s Ramgad Minerals and Mining Ltd. & Ors. – Respondents
CIVIL APPEAL NO(S). 2818 OF 2015 (@ SLP (C) NO(S).32226 OF 2009)
Decided on: 12-03-2015

IMPORTANT POINTS
When mining lease land is surrendered, lease deed book is surrendered, arrears paid and ‘no due certificate’ issued, the surrender would be complete.
When a mining lease holder surrenders it, he loses all rights in the lease. It is no longer open to him to recommend transfer of the land to anybody.
In case of a surrendered mining lease land the only course open to the State is to invoke Rule 59(1) by auction the land by public auction.

Headnote:(a) Mineral Concession Rules – Rule 29(1) – Lessee may at any time determine the lease by giving not less than 12 calendar months’ notice in writing to the State Government – Director of Mines and Geology signing, on behalf of the State Government, the lease deed with M/s Dalmia – Must be taken to be competent to determine the lease as well – Commerce and Industries Department not competent – M/s Dalmia sending its communication of surrender of lease to Director of Mines and Geology – Held valid. (Para 76, 78, 79)

       (b) Mineral Concession Rules – Rule 29(1) – M.L. No. 2010 lapsing on 27.3.2001 – M/s Dalmia, while surrendering M.L. No. 2010 specifically stating that it may be determined on an earlier date, before expiry of 12 months – M /s Dalmia surrendering the Lease deed book – Paying arrears of rent and obtaining no due certificate – No specific bar that the state government should wait for the expiry of the twelve months period – When M/s Dalmia has surrendered major chunk and was left with only 130.4 hectares and that too was not being worked – No reason why State Government should have waited for 12 months to expire before accepting the surrender. (Para 80, 81, 82)

       AIR 1959 SC 149 – Relied upon

       (1997) 2 SCC 267; (1997) 3 SCC 312 – Referred

       (c) Mineral Concession Rules – Rule 29(1) – M/s Dalmia surrendering M.L. 2010 – Becoming final – Cannot resile therefrom – Cannot contend that it still had a right to transfer the rights under M.L. No.2010. (Para 87)

       (2009) 1 SCC 180; (2009) 15 SCC 705 – Distinguished

       (d) Mineral Concession Rules – Rule 37(1A) – M/s Dalmia committing serious violations of section 2 of the Forest Conservation Act, 1980 while carrying out first renewal of lease – Subsequently also violating the conditions of Stage I ex post facto approval for working the lease – ML 2010 held void ab initio. (Para 92, 93)

       (1978) 3 SCC 258; (2000) 2 SCC 756 – Distinguished

       (e) Mineral Concession Rules – Rule 29 – Mining lease – M.L.2010 – Part VIII paragraphs 4 and 5 – Acceptance of surrender of lease by State Government required, by necessary implication – Surrender by M/s Dalmia – Factually accepted by State of Karnataka – Surrender complete and had come into effect. (Para 95, 98)

       (2006) 5 SCC 311 – Relied upon

       (2011) 5 SCC 353; (1989) 4 SCC 121; (1989) 4 SCC 121; (2003) 8 SCC 311; (2005) 7 SCC 605; (2010) 13 SCC 1; (2002) 4 SCC 316; (2014) 5 SCC 660 – Referred

       (f) Mineral Concession Rules – Rule 27(2)(l) – M.L. No.2010 – Containing no specific provision for delivery of possession on surrender – Delivery of possession was not mandatorily required. (Para 100)

       (g) Forest Conservation Act, 1980 – Section 2 – Prior approval of Central Government – Any relaxation would be subject to mining lease – Section 19 and Section 5(1), Proviso – MMDR Act – Mandatory – Mining lease granted originally or renewed subsequently in contravention of the provisions of the MMDR Act or any Rules or any Order made thereunder – A mining lease would be valid only if approval of the Central Government under the proviso to Section 5(1) of MMDR Act and Section 2 of the Forest Conservation Act of 1980 have been obtained – Instantly even in first renewal section 2 of Forest Act was violated – Again in second Stage I approval, its conditions were violated – Hence there was no valid lease. (Para 105, 107)

       (h) Mineral Concession Rules – Rule 37(1A) – Lease becoming void ab initio for violation of Section 2 of the Forest Conservation Act, 1980 as well as Proviso to Section 5 of the MMDR Act – No question of transfer of the leased land. (Para 108)

       (2008) 12 SCC 646; (2009) 5 SCC 373; 1989 Supl. (1) SCC 504; (1987) 1 SCC 213 – Relied upon – Relied upon

       (i) Mineral Concession Rules – Rule 59(1) – Transfer of lease land – State refusing transfer of surrendered lease land to MSPL on 25.8.2001on ground of provisions of Rule 59(1) – Allowing M/s Dalmia’s request of transfer to first respondent on 6.2.2002 ignoring Rule 59(1) – No justifiable reason assigned – Not permissible. (Para 114)

       (2013) 14 SCC 737 – Relied upon

       (j) Mineral Concession Rules – Rule 59(1) – M.L. No.2010 coming to an end on surrender of lease land by M/s Dalmia – M/s Dalmia retaining no right to recommend transfer of lease to anybody – a Could not be transferred to first respondent without complying with requirements of Rule 59(1) – The only other course open to the State Government was to invoke Rule 59 by throwing open those lands by way of public auction. (Para 117)

       Facts of the case:

       Mining lease with reference to M.L.No.2010 over an extent of 331.50 hectares (819.20 acres) of forest area in Jaisinghpur village, R.M. Block, Sandur Taluk, Bellary District was originally granted in favour of M/s. Dalmia on 25.11.1953. The said lease expired on 24.11.1983. Based on the application of M/s. Dalmia Cements, the mining lease was renewed for 20 years with retrospective effect from 25.11.1983 by an order dated 07.03.1986.

       By its letter dated 16.04.1999, M/s. Dalmia surrendered 196.58 hectares of land out of the leased area of 331.50 hectares to the Forest Department of the State Government. Subsequently, M/s. Dalmia in its letter dated 27.03.2001, expressed its desire to surrender the remaining area held by it. By letter dated 25.05.2001, the office of the Director of Mines while communicating to one of its officers marked a copy of its letter dated 25.05.2001 calling upon M/s. Dalmia to surrender its lease deed book and mining plan. By letter dated 16.06.2001 M/s. Dalmia surrendered the lease deed book and informed that its mining plan was missing.

       Subsequently, one M.S.P.L. Limited, applied for grant of mining lease of the area held by M/s. Dalmia. The Director of Mines and Geology stated that grant of mining lease of surrendered lands can only be considered as specified in Rule 59(1) of the Mineral Concession Rules.

       On 04.02.2002, M/s. Dalmia applied to the State Government for permission to transfer its mining lease M.L.No.2010 of 2010 including the 196.58 hectares said to have been surrendered by it in 1999 to the first respondent herein. On 06.02.2002 the Director of Mines and Geology recommended for the transfer of licence from M/s. Dalmia to the first respondent herein. On 16.03.2002, the State Government passed orders allowing the application for transfer of mining lease as applied for by M/s Dalmia in favour of the first respondent.

       At the instance of the appellant, the order dated 16.03.2002, of the State Government was challenged. The learned Single Judge of the Karnataka High Court allowed the said writ petition.

       The Division Bench set aside the order of the learned Single Judge and restored the order of transfer dated 16.03.2002.

       Finding of the Court:

       Order of the learned Single Judge in setting aside the said order dated 16.03.2002, was perfectly justified.

       Result: Appeal allowed.