IMPORTANT POINT
Mining lessees must contribute for reclamation and reconstruction.
State of Karnataka and the CEC called upon to submit a detailed proposal with regard to implementation of the Scheme.

JUDGMENT :

Ranjan Gogoi, J.

1. Two related and connected issues have arisen for determination in the present interlocutory applications.

2. The first is with regard to the objection of the mining lessees to continue to pay 10% of the sale proceeds of mining to the Monitoring Committee for eventual transfer to the Special Purpose Vehicle (“SPV” for short) that has since been constituted to implement the Comprehensive Environment Plan for the Mining Impact Zone (“CEPMIZ” for short and hereinafter referred to as ‘the scheme’) in the Districts of Bellary, Chitradurga and Tumkur of the State of Karnataka. For the present, it will be sufficient to notice that this Court by its orders passed from time to time had directed the setting up of a Special Purpose Vehicle for the purpose of execution of ameliorative and mitigative works/measures to deal with the large scale degradation of the environment that had occurred due to the unprecedented illegal mining that had taken place in the mining leases operating in the aforesaid three districts at the relevant point of time. This Court had, from time to time, directed preparation of a scheme outlining all the details of the works required to be undertaken; the process of implementation of the same by implementing agencies; accounting procedures etc. and for submission of the same to this Court in consultation with the Central Empowered Committee (“CEC” for short). This Court was also of the view that the funds for the SPV to enable ameliorative and mitigative measures to be undertaken, as per the CEPMIZ to be prepared, would primarily come from (a) 10% of the sale proceeds of the minerals; (b) compensation for illegal mining etc.; and (c) other receivables by the Monitoring Committee to be directed to be transferred to the SPV from time to time.

3. The various orders passed by this Court from time to time had received final approval of this Court in the judgment and order dated 18.4.2013 which finally terminated Writ Petition (C) No. 562 of 2009 titled “Samaj Parivartana Samudaya and Ors. vs. State of Karnataka and Ors., [2013 (8) SCC 154].

4. Pursuant to the aforesaid orders, the Government of Karnataka has constituted a Special Purpose Vehicle known as Karnataka Mining Environment Restoration Corporation (“KMERC” for short) on 13.06.2014 with the Additional Chief Secretary to the Government of Karnataka as the Chairman. The CEPMIZ i.e. the Scheme has since been prepared and is presently awaiting the approval of the Court which is the next/connected aspect of the matter, for the present.

5. Insofar as the first question is concerned, the prayer made by the applicant, Federation of Indian Mining Industry, Southern Region (“FIMI-Southern Region”) and duly supported by another lessee M/s. Vedanta, in short, is that after the Mines and Minerals (Development and Regulation) Amendment Act 2015 had brought in Section 9B in the Act with effect from 12.1.2015 a District Mineral Foundation is required to be set up in every district affected by mining related operations. Under Section 9B(5) and (6) lessees are required to pay to the District Mineral Foundation (“DMF” for short) an amount equivalent to such percentage of royalty not exceeding one-third of such royalty, as may be prescribed by the Central Government.

6. The Ministry of Mines, Government of India by a Notification dated 17.09.2015 has prescribed that in respect of leases granted prior to 12.01.2015 the amount payable to the DMF shall be 30% of the royalty i.e. 5.5% of the sale value (approx.) and in respect of leases granted after 12.01.2005 the contribution to the DMF shall be @ 10% of the royalty i.e. 1.5% of the sale value. Consequently, the leases in Category-A and Category-B mines, presently, in addition to 10% of the sale value payable to the Monitoring Committee/SPV are required to pay about 4.5% of such value to the District Mine