IMPORTANT POINTS
Deemed mining leases in Goa expired on 22.11.2007 rendering mining thereafter illegal.
Dumping of minerals outside the leased area is not permissible.
There can be no mining activities within one kilometer from the boundaries of National Parks and Sanctuaries in Goa;
MoEF will issue the notification of eco-sensitive zones around the National Park and Wildlife Sanctuaries of Goa.
State Government will initiate action against those mining lessees who violate Rules 37 and 38 of the MC Rules.
State Government will strictly enforce the Goa (Prevention of Illegal Mining, Storage and Transportation of Minerals) Rules, 2013.
Until the final report is submitted by the Expert Committee, the State Government will permit a maximum annual excavation of 20 million MT from the mining leases in the State of Goa other than from dumps.
The entire sale value of the e-auction of the inventorised ores will be forthwith realised and out of the total sale value the following payments will be made:
(a) Average cost of excavation of iron ores to the mining lessees;
(b) 50% of the wages and dearness allowance to the workers in the muster rolls of the mining leases who have not been paid their wages during the period of suspension of mining operations;
(c) 50% of the claim towards storage charges of MPT.
Out of the balance, 10% will be appropriated towards the Goan Iron Ore Permanent Fund and the remaining amount will be appropriated by the State Government as the owner of the ores.
Henceforth, the mining lessees of iron ore will have to pay 10% of the sale price of the iron ore sold by them to the Goa Iron Ore Permanent Fund.

Headnote:(a) Commissions of Inquiry Act, 1952 – Section 8B and 8C – Justice Shah Commission making recommendation on various issues and prosecution of mining lessees for violation of environmental laws – Commission not complying with section 8B and 8C – Not proper and violative of Article 14 of the constitution – Government assuring that it will not go by the Commission’s report and make its own assessment and give opportunity to mining lessees before taking any action – In that view Commission’s report not quashed – Prosecution also restrained until opportunity is afforded to the mining lessees. (Para 10, 11)
       (1989) 1 SCC 494; (2003) 8 SCC 361; (1985) 3 SCC 398 – Relied upon
       1985 (1) Bom. CR 36 – Referred
       (b) Mineral Concession Rules, 1960 – Rule 24 r/w sections 4 and 5, Goa, Daman and Diu Mining Concessions (Abolition and Declaration as Mining Leases) Act, 1987 – Abolition Act converting mining concessions into leases – First renewal u/r 24 – Date for application extended up to 22.11.1988 under sub rule (4) and (8) – Under sub-rule (9) if the application for first renewal is filed within time, deemed lease would be deemed to be extended until orders were passed by the State Government on the application – Shah Commission holding that as the State government has not passed orders within time, leases have expired – Not correct. (Para 18)
       (c) Mineral Concession Rules, 1960 – Rule 24A – Sub-rules (4), (5), (8) and (9) – Sub-rules (4) and (5) for general application – Sub-rules (8) and (9) specifically applicable to the State of Goa – Hence sub-rules (4) and (5) will not apply to Goa. (Para 18)
       (d) Mines and Minerals (Development & Regulation) Act, 1957 – Section 8 – Sub-section (1) not applicable to deemed leases in view of Section 5 of Abolition Act – Sub-section (2) limiting period of renewal to 20 years – However, sub-section (3) empowering State, for reasons to be recorded, to renew the lease of minerals not specified in Part A and Part B of the First Schedule beyond 20 years – Sub-section (3) can be invoked only if in Government’s view that such renewal would be in the interest of mineral development. (Para 23,
       (1996) 9 SCC 709 – Relied upon
       (2004) 1 SCC 1 – Referred
       (e) Mineral Concession Rules, 1960 – Rule 24A (6) and (9) r/w Section 8(2) and (3), Mines and Minerals (Development & Regulation) Act, 1957 – Sub-rule (6) providing for extension of lease till order of State government on application of first renewal if not passed within time – Condition precedent for renewal u/s 8(3) being express order of government recording reasons for renewal in the interest of mineral development – Rule 24A(6) will apply to a case of first renewal u/s 8(2) of MMDR Act and other than a case covered under Rule 24A(9) – It will not apply to renewal u/s 8(3) of MMDR Act – Accordingly deemed mining leases in Goa expired on 22.11.1987 u/s 5(1) of Goa, Daman and Diu Mining Concessions (Abolition and Declaration as Mining Leases) Act, 1987 – Further, maximum of 20 years renewal period of deemed mining leases in Goa as provided in section 8(2) of MMDR Act r/w Rule 24A(8) and (9) of MC Rules expired on 22.11.2007. (Para 24)
       (f) Mineral Conservation and Development Rules, 1988 – Rule 16 r/w Sections 4(1) and 9(2), MMDR Act and Rule 64C, Mineral Concession Rules, 1960 – Rule 64C exempting removal of tailings or rejects from the leased area for dumping from royalty – Section 4 and 9(2) of MMRDA Act not permitting dumping of tailings or rejects outside leased area without payment of royalty – Rues must give way to provisions of the Act – Therefore, dump cannot be kept by the lessees beyond the leased area. (Para 29, 30, 31)
       AIR 1960 SC 12 – Relied upon
       (2013) 8 SCC 154 – Referred
       (g) Mineral Conservation and Development Rules, 1988 – Rule 16 – Requiring overburden and waste material obtained during mining operations to be dumped and stacked separately on the ground earmarked for the purpose – Rule further requiring such dumping area to be away from working pit – Rule cannot be read as permitting dumping of overburden etc. outside the leased area. (Para 32)
       (h) Environment (Protection) Rules, 1986 – Rule 5(3) – Contention of lessees that they are entitled to dump overburden, tailings, rejects on lands outside leased area but owned by them – Mining operations generally conducted in forest area – Even private land situated within forest area shall require environmental clearance for dumping. (Para 33)
       (i) Constitution of India – Article 32 and Rule 5, Environment Protection Rules, 1986 – Supreme Court prohibiting mining operation within 1 km of National Parks or Wildlife Sanctuaries – Under Rule 5 Central Government can also direct prohibitions in areas proximate to National Parks or Wildlife Sanctuaries – Declaration of eco-sensitive zones – Ministry of Environment and Forests directed to follow the procedure and issue the notification of eco sensitive zones under Rule 5 within six months. (Para 44, 46)
       Writ Petition No. 460/2004 (SC); Writ Petition 202 of 1995 (SC); (2011) 1 SCC 744 – Referred
       (j) Mineral Concession Rules, 1960 – Rule 37 – Transfer of mining leases – Liabilities and conditions of a mining lease made enforceable against transferee – Further, transferee must be paying his income tax regularly – Violation of Rule 37 must not be allowed and action must be initiated against those who violate Rule 37. (Para 49)
       (k) Mineral Concession Rules, 1960 – Rule 38 – Amalgamation of leases – Cannot be allowed in absence of State government permission stating reasons therefor. (Para 50)
       (l) Environment (Protection) Act, 1986 – Section 3(3) – Regulator to be appointed for Goa with responsibility of implementing Supreme Court directions in case of Lafarge Umiam Mining Private Limited – Sustainable development and inter-generational equity – Goan Iron Ore Permanent Fund proposed – Lessees directed to contribute 10% of the sale proceeds of iron ore excavated in the State of Goa and sold by them to the fund – State directed to frame a comprehensive scheme. (Para 61, 63)
       Writ Petition (Civil) No. 202 of 1995; I.A. Nos. 1868, 2091, 2225-2227, 2380, 2568 and 2937 – Referred
       (m) Constitution of India – Article 39(b) – Alienation/allotment of natural resources – Method of – Iron ore mining leases in Goa – Whether by e-auction – Policy decision – Left to State government to take decision in accordance with policy and the provisions of the MMDR Act and the MC Rules – Auction not a constitutional requirement – Implementation of the policy so decided will be amenable to judicial review. (Para 65, 66)
       (2012) 3 SCC 1; (2012) 10 SCC 1 – Referred
       (n) Mineral Concession Rules, 1960 – Rule 24A (6) and (9) r/w Section 8(2) and (3), Mines and Minerals (Development & Regulation) Act, 1957 – Maximum period of renewal of mining leases expiring on 22.11.2007 – Mining thereafter illegal – Suspension of mining operations by State government vide order dated 10.09.2012 and suspension of environmental clearances by MoEF dated 14.09.2012 – Cannot be quashed – Shall continue till decisions are taken by State Government to grant fresh leases and by MoEF to grant fresh environmental clearances. (Para 67)
       (o) Mineral Concession Rules, 1960 – Rule 24A (6) and (9) r/w Section 8(2) and (3), Mines and Minerals (Development & Regulation) Act, 1957 – After expiry of deemed leases on 02.11.2007 mining thereafter becoming illegal – Erstwhile lessees not having any rights on the lease areas or the mined minerals after 02.11.2007 – State becomes owner – Method of disposal – Inventory to be prepared and minerals to be auctioned – Lessees to be paid cost of excavation – Out of sale proceeds unpaid labour to be paid 50% of unpaid wages – Port trust also to be compensated 50% of their charges for storage of minerals after 05.10.2012 – 10% of the balance to go in Goan Iron Ore Permanent Fund. (Para 69, 70)
       Writ Petition (C) No. 435 of 2012 – Referred
       Facts of the case:
       Prior to 19.12.1961 when Goa was a Portuguese territory, its Portuguese Government had granted mining concessions in perpetuity to concessionaires. On 19.12.1961, Goa was liberated and became part of the Indian Union and on 01.10.1963, the Mines and Minerals (Development & Regulation) Act, 1957 was made applicable to the State of Goa.
       On 10.03.1975, the Controller of Mining Leases issued a notification calling upon every lessee and sub-lessee to file returns under Rule 5 of the Mining Leases (Modification of Terms) Rules, 1956 and sent copies of the notification to the concessionaires in Goa. Aggrieved, the concessionaires moved the Bombay High Court, Goa Bench, which restrained the Union of India from treating the concessions as mining leases and from enforcing the notification against the concessionaires.
       Parliament thereafter passed the Goa, Daman and Diu Mining Concessions (Abolition and Declaration as Mining Leases) Act, 1987 which received the assent of the President on 23.05.1987. Section 4 of the Abolition Act abolished the mining concessions and declared that with effect from the 20th day of December, 1961, every mining concession will be deemed to be a mining lease granted under the MMDR Act and that the provisions of the MMDR Act will apply to such mining lease. Section 5 of the Abolition Act further provided that the concession holder shall be deemed to have become a holder of the mining lease under the MMDR Act in relation to the mines in which the concession relates and the period of such lease was to extend upto six months from the date when the Abolition Act received President's assent, i.e. upto 22.11.1987. On 14.10.1987, Sub-rules (8) and (9) were inserted in Rule 24A of the Mineral Concession Rules, 1960 which deal with renewal of mining leases in Goa, Daman and Diu. The Abolition Act was challenged by the lessees before the Bombay High Court in a writ petition. The High Court passed an interim order permitting the lessees to carry on mining operations and the mining business in the concessions for which renewal applications had been filed under Rule 24A of the MC Rules. Subsequently, the High Court held that the Abolition Act was valid but Section 22(i)(a) of the Abolition Act would operate prospectively and not retrospectively. The concessionaires filed special leave petition against the judgment dated 20.06.1997 before Supreme Court. On 02.03.1998, Supreme Court passed an interim order permitting the concessionaires to carry on mining operations and mining business in the mining areas for which renewal applications have been made on the condition that the lessee pays to the Government dead rent from the date of commencement of the Abolition Act. Subsequently, Supreme Court granted leave in the special leave petition and continued the aforesaid interim order.
       Pursuant to the Shah Commission report the State Government of Goa passed an order suspending all mining operations in the State of Goa with effect from 11.9.2012.
       The District Magistrates of the State of Goa banned transportation of iron ore in their respective districts and the Director of Mines and Geology ordered for verification of mineral ore which was already extracted. On 13.9.2012, the Director of Mines and Geology, Government of Goa issued Show Cause Notices to 40 mining leases. On 14.9.2012, the Ministry of Environment and Forests of the Union of India also directed that all Environmental Clearances granted to mines in the State of Goa be kept in abeyance.
       On the basis of findings in the report of the Justice Shah Commission on illegal mining in the State of Goa, the Goa Foundation has filed this Writ Petition (C) 435 of 2012 as Public Interest Litigation praying for directions to the Union of India and the State of Goa to take steps for termination of the mining leases of lessees involved in mining in violation of the Forest (Conservation) Act, 1980, the Mines and Minerals (Regulation and Development) Act, 1957, the Mineral Concessions Rules, 1960, the Environment (Protection) Act, 1986, the Water (Prevention & Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981 as well as the Wild Life (Protection) Act, 1972. The Goa Foundation has prayed that a direction be issued to the Respondents to prosecute all those who have committed offences under the different laws and are involved in the pilferage of State revenue through illegal mining activities in the State of Goa including the public servants who have aided and abetted the offences. The Goa Foundation has also sought for appointment of an independent authority with full powers to take control, supervise and regulate mining operations in the State of Goa and to ensure the implementation of the laws. Besides, the aforesaid main reliefs, the Goa Foundation has also prayed for some incidental and consequential reliefs.
       Different mining lessees of the State of Goa and the Goa Mining Association also filed Writ Petitions in the Bombay High Court, Goa Bench for a declaration that the report of the Shah Commission is illegal and for quashing the findings in the report of the Justice Shah Commission and also for quashing the order dated 10.9.2012 of the Government of Goa suspending mining operations in the State of Goa and the order dated 14.9.2012 of the Ministry of Environment and Forests, Government of India, directing that the Environmental Clearances granted to the mines in the State of Goa be kept in abeyance. These Writ Petitions have been transferred to Supreme Court for hearing along with the hearing of Writ Petition (Civil) No. 435 of 2012 filed by the Goa Foundation.
       Finding of the Court:
       Goa (Prevention of Illegal Mining, Storage and Transportation of Minerals) Rules, 2013 will have to be strictly enforced by the State Government.
       Result: Writ Petition (C) No. 435 of 2012 allowed.
       Transferred Cases and IA filed by MPT as well as other IAs disposed of.

JUDGMENT

A.K. Patnaik, J.

1. This batch of Writ Petitions and Transferred Cases relate to mining in the State of Goa and as issues raised are common to the Writ Petitions and the Transferred Cases, the cases have been analogously heard and are being disposed of by this common judgment.

Facts relating to mining in Goa:

2. Prior to 19.12.1961 when Goa was a Portuguese territory, its Portuguese Government had granted mining concessions in perpetuity to concessionaires. On 19.12.1961, Goa was liberated and became part of the Indian Union and on 01.10.1963, the Mines and Minerals (Development & Regulation) Act, 1957 (for short 'the MMDR Act') was made applicable to the State of Goa. On 10.03.1975, the Controller of Mining Leases issued a notification calling upon every lessee and sub-lessee to file returns under Rule 5 of the Mining Leases (Modification of Terms) Rules, 1956 and sent copies of the notification to the concessionaires in Goa. Aggrieved, the concessionaires moved the Bombay High Court, Goa Bench, and by judgment dated 29.09.1983, in Vassudeva Madeva Salgaocar v. Union of India, 1985 (1) Bom. CR 36], the Bombay High Court restrained the Union of India from treating the concessions as mining leases and from enforcing the notification against the concessionaires.

3. Parliament thereafter passed the Goa, Daman and Diu Mining Concessions (Abolition and Declaration as Mining Leases) Act, 1987 (for short 'the Abolition Act') which received the assent of the President on 23.05.1987. Section 4 of the Abolition Act abolished the mining concessions and declared that with effect from the 20th day of December, 1961, every mining concession will be deemed to be a mining lease granted under the MMDR Act and that the provisions of the MMDR Act will apply to such mining lease. Section 5 of the Abolition Act further provided that the concession holder shall be deemed to have become a holder of the mining lease under the MMDR Act in relation to the mines in which the concession relates and the period of such lease was to extend upto six months from the date when the Abolition Act received President's assent, i.e. upto 22.11.1987. On 14.10.1987, Sub-rules (8) and (9) were inserted in Rule 24A of the Mineral Concession Rules, 1960 (for short 'the MC Rules') which deal with renewal of mining leases in Goa, Daman and Diu. The Abolition Act was challenged by the lessees before the Bombay High Court in a writ petition. The High Court passed an interim order permitting the lessees to carry on mining operations and the mining business in the concessions for which renewal applications had been filed under Rule 24A of the MC Rules. Subsequently, the High Court held in its judgment dated 20.06.1997 that the Abolition Act was valid but Section 22(i)(a) of the Abolition Act would operate prospectively and not retrospectively. The concessionaires filed special leave petition against the judgment dated 20.06.1997 before this Court. On 02.03.1998, this Court passed an interim order permitting the concessionaires to carry on mining operations and mining business in the mining areas for which renewal applications have been made on the condition that the lessee pays to the Government dead rent from the date of commencement of the Abolition Act. Subsequently, this Court granted leave in the special leave petition and continued the aforesaid interim order.

The Justice Shah Commission and its report:

4. As reports were received from various State Governments of widespread mining of iron ore and manganese ore in contravention of the provisions of the MMDR Act, the Forests (Conservation) Act 1980, the Environment (Protection) Act, 1986 and other rules and guidelines issued thereunder, the Central Government appointed the Justice Shah Commission under Section 3 of the Commissions of Inquiry Act, 1952 by notification dated 22.11.2010. Paras 2 and 3 of the n

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2015 Supreme(SC) 950

Cases Referred (11)