2017 Supreme(SC) 705

SUPREME COURT OF INDIA
Madan B. Lokur, Deepak Gupta, JJ.
Common Cause – Petitioner
Versus
Union of India and Ors. – Respondents
Writ Petition (Civil) No. 114 of 2014
With
Prafulla Samantra and Anr. – Petitioners
Versus
Union of India and Ors. – Respondents
Writ Petition (Civil) No. 194 of 2014
Decided On : 02-08-2017

IMPORTANT POINTS
Mining operations cannot be commenced unless EC is obtained.
Mining lease holder would necessarily have to obtain a fresh EC every five years and can also apply for an increase in the sanctioned capacity.
Mining operation in violation of any statutory provision would be illegal. Illegal mining is not confined only to mining operations outside a leased area.
Lease holder cannot extract over and above annual mining plan in excess of 20% in any year.
Recovery of price u/s 21(5) is not a penal action. It is merely compensatory.
Action u/r 2(ii a) cannot preclude compensation to State u/s 21(5). MCR cannot govern MMDR Act.
Upon payment of additional NPV as also penal compensatory afforestation violation of the FC Act must be assumed to be condoned.
Only one set of compensation payable in case of mining without EC or FC or both.
Scheme of State of Odisha as regards SPV for welfare of tribal people approved.

Headnote:(a) Commissions of Inquiry Act, 1952 – Section 8B or Section 8C – First Report of JusticeShah Commission – Commission not issuing notices to mining lease holders – Report general in nature not touching any specific issues – Lease holders concerned with subject matter of second report – No-issue of notices for first report, held, of no consequence. (Para 32, 43)

       (b) Court monitoring – Illegal mining – Initially Supreme Court ordering that CEC Report will not cover cases other than forest and environmental issues – However subsequently on different dates the scope was enlarged and CEC was expected to give a detailed report on all aspects of illegal mining or mining being carried out without any lawful authority in whatever manner – Initial objection of CEC exceeding its jurisdiction rejected. (Para 53)

       (c) Central Empowered Committee (CEC) – Fact finding body constituted by Supreme Court – Functioning impartially – No dispute about facts collected by CEC. (Para 58, 59)

       (2013) 8 SCC 198; (2013) 8 SCC 204; (2013) 8 SCC 154; (2014) 14 SCC 155; (2016) 11 SCC 455 – Referred

       (d) Mining laws – Mineral Concession Rules, 1960 deals with the grant of a mining lease – Not concerned with commencement of mining operations – Mineral Conservation and Development Rules, 1988, on the other hand deals with commencement of mining operations and protection of environment by preventing and controlling pollution – Thus mining operations cannot be commenced unless EC is obtained. (Para 67, 103)

       (e) Mineral Concession Rules, 1960 – Rule 22 and 22A – Mining scheme and mining plan – Sine qua non for grant of a mining lease – Mining lease subject to lessee’s compliance with Mineral Conservation and Development Rules, 1988. (Para 70, 71)

       (f) Mining laws – Overall purpose and objective of Mines and Minerals (Development and Regulation) Act, 1957 and Rules framed thereunder – Ensuring mining operations in scientific manner protecting and preserving environment and flora of the area – Lease holder obliged to adhere to adhere to the standards laid down under Environment (Protection) Act, 1986 as well as laws pertaining to air and water pollution and also by necessary implication, provisions of Forest (Conservation) Act, 1980 – Penalties for non-compliance u/s 21and termination of mining lease u/s 4A. (Para 83)

       (g) Environment Protection Act – Section 3(1) and (2)(v) r/w Rule 5(3)(d), Environment (Protection) Rules, 1986 – Environment Impact Assessment – Fresh environment clearance every five years, mandatory – A mining lease holder would necessarily have to obtain a fresh EC every five years and can also apply for an increase in the sanctioned capacity – Environment Impact Assessment Notification dated 27th January, 1994 – Mining operations under a mining lease – Dependent on and ‘subordinate’ to the EC – An approved mining plan does not imply that a mining lease holder can commence mining operations. (Para 86, 116)

       (h) Environment Impact Assessment Notification of 27th January, 1994 (EIA, 1994) – EIA, 1994 is mandatory – New projects require an EC – Proposed expansion or modernisation of mining project would require fresh Environment clearance if it is likely to increase the existing cleared pollution load, base year being 1993-94 – Similarly existing projects having a NOC from SPCB before 27th January, 1994 not required to obtain an EC from Impact Assessment Agency. (Para 89, 90, 93, 95, 105)

       (2004) 12 SCC 118 – Relied upon

       (i) Mineral Concession Rules, 1960 – Rule 24A – EIA 1994 – Environmental jurisprudence – Rule 24A operates only after an application for renewal is made in Form J in Schedule I – Held, renewal of a mining lease would require a prior EC. (Para 121)

       (2004) 12 SCC 118 – Relied upon

       (j) Environmental jurisprudence – Concept of ex post facto or a retrospective EC completely alien to environmental jurisprudence including EIA 1994 and EIA 2006 – Held, an EC will come into force not earlier than the date of its grant. (Para 124)

       (k) Mineral Concession Rules, 1960 – Rule 2(iia) – Illegal mining – Interpretation of expression ‘illegal mining’ – Present issues concern period prior to insertion of Rule 2(iia) – Mining lease holder required to adhere to terms of mining scheme, mining plan and mining lease as well as statutes such as EPA, FCA, Water (Prevention and Control of Pollution) Act, 1974 and Air (Prevention and Control of Pollution) Act, 1981 – Mining operation in violation of any of these provisions would be illegal – Illegal mining not confined only to mining operations outside a leased area. (Para 128, 129)

       (l) Mines and Minerals (Development and Regulation) Act, 1957 – Section 4(1) – Mining operations carried out outside boundaries of mining lease – Illegal – Fresh joint survey directed. (Para 130, 134)

       (m) Mineral Concession Rules, 1960 – Rule 22(5) – Permissible variation in extraction of mineral to the extent of 20% over annual mining plan year to year for five years – Lease holder cannot extract over and above annual mining plan in excess of 20% in any year – Lease holder cannot extract the five year quantity (with a variation of 20%) in one or two years only. (Para 135)

       (n) Mines and Minerals (Development and Regulation) Act, 1957 – Sections 21(1) and 21(5) – Illegal mining – Section 21(1) applies in case of contravention of Section 4(1) and entails prosecution – Section 21(5) applies only in cases of illegal mining outside leased area – Recovery of price u/s 21(5) not penal action – It is merely compensatory. (Para 141, 142, 148, 150)

       (2004) 2 SCC 783 – Relied upon

       (1975) 2 SCC 22 – Distinguished

       (o) Mineral Concession Rules, 1960 – Rule 2(ii a) and section 21(5), MMDR – Section 21(5) is attracted in any violation within or outside mining lease area – Action u/r 2(ii a) cannot preclude compensation to State u/s 21(5) – MCR cannot govern MMDR Act. (Para 150)

       (p) Mines and Minerals (Development and Regulation) Act, 1957 – Section 21(5) – Compensation should be payable from 2000-2001 onwards at 100% of the price of the mineral, as rationalized by the CEC. (Para 153, 156, 183)

       (q) Forest (Conservation) Act, 1980 – Section 2 – Complete ban on non-forest activity on forest lands with effect from 12th December, 1996 – Pursuant to directions of Supreme Court State of Odisha realizing an amount of about Rs. 1750 crores as additional NPV – Mining lease holders also paying penal compensatory afforestation – Violation of the Act must be assumed to be condoned – Condonation not applicable to illegal or unlawful mining u/s 21(5), MMDR Act (Para 172, 174, 176, 178, 185)

       (1985) 3 SCC 643; (1987) 1 SCC 213; (1989) Supp. (1) SCC 504; (1997) 2 SCC 267; (1997) 3 SCC 312; (2011) 15 SCC 658; (2011) 15 SCC 681 – Referred

       (r) Forest (Conservation) Act, 1980 – Section 2 and 21(5), Mines and Minerals (Development and Regulation) Act, 1957 – Mining activity in forest and DLC lands in violation of section 2 would be subject to section 21(5) – Therefore, price of the iron ore and manganese ore mined from 7th January, 1998 is payable until forest clearance u/s 2 is obtained by the mining lease holders. (Para 179)

       (s) Mining laws – Mining without EC or FC or both – Attracts section 21(5), MMDR Act – Compensation at 100% of the price of the illegally or unlawfully mined mineral payable – Overlap of period in case of absence of both – Only one set of compensation payable – However, payment already made towards NPV, additional NPV or penal compensatory afforestation neither adjustable nor refundable.(Para 184, 186)

       (t) Mineral Concession Rules, 1960 – Rule 37 – Violation of by some mining lease holders – Appointment of appropriate Committee contemplated to look into violation of Rule 37 – Committee would be empowered to lift the corporate veil. (Para 204)

       (2016) 4 SCC 469 – Relied upon

       (u) Mining law – Effect of unauthorized mining on the flora and tribal population of the areas – Special Purpose Vehicle for welfare of tribal people mooted – Scheme of State of Odisha approved. (Para 214, 215, 216)

       (2008) 2 SCC 222 – Referred

       Facts of the case:

       This case relates to illegal mining causing extensive and large scale damage to environment and the tribal people in the districts of Keonjhar, Sundergarh and Mayurbhanj of the State of Odisha.

       Finding of the Court:

       There is no confusion, vagueness or uncertainty in the application of EIA 1994 and EIA 2006 insofar as mining operations were commenced on mining leases before 27th January, 1994 (or even thereafter). Post EIA 2006, every mining lease holder having a lease area of 5 hectares or more and undertaking mining operations in respect of major minerals was obliged to get an EC in terms of EIA 2006.

       Result: Writ petitions and I.A.s disposed of.