1. Challenge to the constitutionality of amendments to mining concession rules replacing first-come-first-serve priority with auction and lottery systems for granting mining leases on government land. (Para 1 , 3 , 4 , 5 , 6 , 7 , 9 , 10 , 11 , 12 , 13 , 14 )
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2023 Supreme(SC) 666
SUPREME COURT OF INDIA
A.S. BOPANNA, M.M. SUNDRESH, JJ.
The State of Rajasthan & Ors. - Appellants
Versus
Sharwan Kumar Kumawat Etc. Etc - Respondents
Civil Appeal Nos. 1162-1171 of 2016 With C.A. Nos. 1212-1214 of 2016, C.A. Nos. 1207-1211 of 2016, C.A. Nos. 1202-1206 of 2016, C.A. Nos. 1182-1186 of 2016, C.A. Nos. 1172-1176 of 2016, C.A. Nos. 1177-1181 of 2016, C.A. Nos. 1187-1189 of 2016, C.A. Nos. 1197-1199 of 2016, C.A. Nos. 1195-1196 of 2016, C.A. Nos. 1200-1201 of 2016, C.A. Nos. 1190-1194 of 2016
Decided On : 01-08-2023
Advocates appeared:
For the Appellant(s) : Mr. Irshad Ahmad, AOR Dr. Manish Singhvi, Sr. Adv. Mr. Arpit Parkash, Adv. Ms. Shubhangi Agarwal, Adv. Mr. Apurv S., Adv. Mr. Milind Kumar, AOR
For the Respondent(s): Ms. Shobha Gupta, AOR Ms. Ankita Gupta, Adv. Ms. Tarjana Rai, Adv. Mr. Rana Ranjit Singh, AOR Mr. Vivek Kumar Singh, Adv. Ms. Akanksha Singh, Adv. Mr. Ravish Singh, Adv. Mr. Avijeet Kumar, Adv. Mr. Ashish Mohan, Adv. Mrs. Ashish Mohan, Adv. Mr. Ashutosh Dubey, AOR Mr. Abhishek Chauhan, Adv. Ms. Rajshri Dubey, adv. Mr. H.B. Dubey, Adv. Mr. Amit P. Shahi, Adv. Mr. Amit Kumar, Adv. Mr. Gaurav Yadav, Adv. Mr. Anuj Bhandari, AOR Mr. Gaurav Jain, Adv. Mr. Rajat Gupta, Adv. Mrs. Disha Bhandari, Adv. Mrs. Anjali Doshi, Adv. Mr. Vipin Kumar Jai, AOR Ms. Namita Choudhary, AOR
For the Appellant(s) : Mr. Irshad Ahmad, AOR Dr. Manish Singhvi, Sr. Adv. Mr. Arpit Parkash, Adv. Ms. Shubhangi Agarwal, Adv. Mr. Apurv S., Adv. Mr. Milind Kumar, AOR
For the Respondent(s): Ms. Shobha Gupta, AOR Ms. Ankita Gupta, Adv. Ms. Tarjana Rai, Adv. Mr. Rana Ranjit Singh, AOR Mr. Vivek Kumar Singh, Adv. Ms. Akanksha Singh, Adv. Mr. Ravish Singh, Adv. Mr. Avijeet Kumar, Adv. Mr. Ashish Mohan, Adv. Mrs. Ashish Mohan, Adv. Mr. Ashutosh Dubey, AOR Mr. Abhishek Chauhan, Adv. Ms. Rajshri Dubey, adv. Mr. H.B. Dubey, Adv. Mr. Amit P. Shahi, Adv. Mr. Amit Kumar, Adv. Mr. Gaurav Yadav, Adv. Mr. Anuj Bhandari, AOR Mr. Gaurav Jain, Adv. Mr. Rajat Gupta, Adv. Mrs. Disha Bhandari, Adv. Mrs. Anjali Doshi, Adv. Mr. Vipin Kumar Jai, AOR Ms. Namita Choudhary, AOR
IMPORTANT POINTS
(1) Lease of Government Land – There is no right vested over application made which is pending seeking lease of a Government land or over minerals beneath soil in any type of land over which Government has a vested right and regulatory control – Mere filing of an application ipso facto does not create any right.
(2) Legitimate Expectation – Legitimate expectation is a weak and sober right as ordained by a statute – Right being not legal, apart from being non-existent, it cannot be enforceable.
Headnote:
(A) Mining Laws – Lease of Government Land – There is no right vested over application made which is pending seeking lease of a Government land or over minerals beneath soil in any type of land over which Government has a vested right and regulatory control – Mere filing of an application ipso facto does not create any right – Power of Government to amend, being an independent one, pending applications do not come in the way – For a right to be vested there has to be a statutory recognition – Such a right has to accrue and any decision will have to create resultant injury – When a decision is taken by a competent authority in public interest by evolving a better process such as auction, a right, if any, to an applicant seeking lease over a Government land evaporates on its own – Applicant cannot have exclusive right in seeking a grant of license of a mineral unless facilitated accordingly by a statute. (Para 17)
(B) Doctrine – Legitimate Expectation – Legitimate expectation is a weak and sober right as ordained by a statute – When Government decides to introduce fair play by way of auction facilitating all eligible persons to contest on equal terms, one cannot contend that he is entitled for a lease merely on the basis of a pending application – Right being not legal, apart from being non-existent, it cannot be enforceable. (Para 19)
(C) Mines and Minerals (Development and Regulation) Act, 1957 – Section 15 – Rajasthan Minor Mineral Concession Rules, 1986 – Rules 4(10) and 7(3) – Constitutionality of Rules – Impugned Rules have been introduced in exercise of power conferred under Section 15 of 1957 Act – There is neither a right nor it gets vested through an application made over a Government land – Law does not facilitate hearing parties in bringing an amendment by an authority competent to do so – There is delegation of power to first appellant which was rightly exercised as conferred under Section 15 of 1957 Act – Impugned Judgments set aside. (Paras 22 and 23)
Facts of the case:
In all these appeals Appellants seek to overturn decision of Division Bench of Rajasthan High Court, Jaipur Bench declaring sub-rule (10) of Rule 4 and sub-rule (3) of Rule 7 of Rajasthan Minor Mineral Concession Rules, 1986 as unconstitutional.
Findings of Court:
High Court has totally misconstrued the issues ignoring fact that there is a delegation of power to first appellant which was rightly exercised as conferred under Section 15 of 1957 Act.
Result : Appeals allowed.
Legal Category Hierarchy
Table of Contents
2. Appellants argue no vested right exists and policy changes are permissible; Respondents claim amendments overreach court orders and violate legitimate expectations and natural justice. (Para 15 , 16 )
3. The court analyzed the absence of vested rights in pending applications, the non-existence of fundamental rights in mining, and the limited scope of legitimate expectation against public interest. (Para 17 , 18 , 19 , 20 , 21 , 22 )
4. Pending applications for government mining leases do not create vested rights, and administrative policy changes in public interest override claims of legitimate expectation. (Para 17 , 19 , 20 )
5. Appeals allowed and impugned High Court judgments set aside, upholding the validity of the amended mining concession rules. (Para 23 )
6. Does the mere filing of an application for a mining lease on government land create a vested right?
No. A pending application does not create a vested right over government land or minerals. The government's power to amend rules is independent, and applications must be dealt with according to the rules in force on the date of disposal. (Para 17 )
7. Is there a fundamental right to be granted a mining lease or prospecting license on government land?
No. No person has a fundamental right to claim that they should be granted a mining lease, prospecting license, or permitted reconnaissance operation in any land belonging to the government. (Para 18 )
8. Can the doctrine of legitimate expectation prevent the government from changing administrative policy for the grant of mining leases?
No. Legitimate expectation cannot fetter changes in administrative policy if the decision is founded in public interest. Personal benefit must give way to overriding public interest, such as introducing a fair auction process. (Para 19 , 20 )
9. Does the amendment of rules to nullify the effect of a court judgment necessarily constitute legal malice?
No. Legal malice involves exercising statutory power for purposes foreign to the law. Removing the basis of a judgment through valid rule amendments in public interest does not constitute legal malice. (Para 21 )
JUDGMENT :
M.M. Sundresh, J.
1. In all these appeals the Appellants seek to overturn the decision of the Division Bench of the Rajasthan High Court, Jaipur Bench declaring sub-rule (10) of Rule 4 and sub-rule (3) of Rule 7 of the Rajasthan Minor Mineral Concession Rules, 1986 (hereinafter referred to as “the Rules”) as unconstitutional.
2. Heard Dr. Manish Singhvi, learned Senior Advocate, appearing for the Appellants and Ms. Shobha Gupta, learned Advocate-on-Record & Ms. Ankita Gupta, learned Advocate, appearing for the Respondents.
A VISIT TO THE RULES:
3. The Rules were brought into statute by the first appellant in exercise of the powers conferred by Section 15 of the Mines and Minerals (Development and Regulation) Act, 1957 (hereinafter referred to as “1957 Act”) for regulating the grant of quarry licenses, mining leases and other mineral concessions qua minor minerals. Chapter II of the Rules deals with grant of leases. Rule 7 speaks of preferential rights of certain persons. As per the said Rule, in existence prior to the amendment made on 28.01.2011, one applicant shall have a preferential right over the others on the sole basis of his application being made prior in point of time. This preferential right was not made available when an application is received from a Government Company or Corporation. It is to be noted, that this Rule does not stand in the way of the first appellant in making appropriate amendments to the Rules in general. Sub-rule (2) of Rule 7 has provided a list of entities, entitled for a lease on an order of priority.
4. The Rules, aforesaid, went through amendments. By way of a Notification dated 28.01.2011, sub-rule (10) had been introduced to Rule 4 placing a condition that there cannot be a mining lease in a Government land excluding marble and granite, unless the area is delineated and thereafter applications are to be invited. However, the proviso went on to say that the applications pending on the date of the Notification shall be disposed of as per the prevailing Rules prior to it. Perhaps this must have been on account of a wrong understanding of the order passed by the High Court.
5. A further amendment was made to Rule 7 by way of substitution of sub-rule (3),
“(3) Notwithstanding anything contained in sub-rule (1) and (2) above, the area for mining lease in the Government land for minerals other than Marble and Granite shall be reserved under rule 73, for allotment after delineation. New System shall be effective from the date of the issue of the notification and the applications received prior to notification shall be disposed of as per prevailing rules in force prior to this notification. Prior to delineation all requisite NOC’s shall be procured by the department. Out of these delineated plots 50% shall be allotted by auction and the remaining 50% shall be allotted to the following categories of persons, as per percentage indicated against each category:-
| (i) | Persons who undertake to install a crusher / mineral based industry; | 10% |
| (ii) | Manual workers belonging to Scheduled Castes / Scheduled Tribes / Other Backward Classes / Special Backward Class employed in Mines; | 5% |
| (iii) | Manual workers other than Scheduled Castes / Scheduled Tribes / Other Backward Classes / Special Backward Class employed in mines; | 5% |
| (iv) | Persons belonging to Scheduled Castes / Scheduled Tribes / Other Backward Classes / Special Backward Class | 20% |
| (v) | Persons identified as Below Poverty Lines; | 10% |
| (vi) | Ex-soldiers including member of para military forces belonging to Rajasthan, who have been permanently disabled or dependents of those who have died while in service; | 5% |
| (vii) | Rajasthan State Government servants who have been permanently disabled while on duty or the dependents of those who have died while in service; | 5% |
| (viii) | Societies of Unemployed youth of Rajasthan; | 30% |
| (ix) | Other persons; | 10% |
In the rese
