The court upheld the validity of the demand for a percentage deposit to the District Mineral Foundation under the applicable statutes, rejecting claims of non-compliance with requisite rules.

JUDGMENT :

AUGUSTINE GEORGE MASIH, J.

1. The instant batch of appeals challenge the respective Demand Notices issued by the District Magistrate/District Officer to the Appellants demanding 10% of the total bid amount to be deposited with the concerned District Mineral Foundation(s) (hereinafter, “DMF”).

2. Since the issue involved in all these appeals is common, the facts are being taken from Civil Appeal No.12314 of 2024, which assails the Judgment dated 15.11.2017 passed by the High Court of Allahabad (hereinafter, “Impugned Judgment”) and has been taken as the lead case.

3. The facts, as culled out from the said Civil Appeal are that Chandra Bhan Singh, who was a successful bidder for mining of minor minerals i.e., sand (hereinafter, “Appellant”) was allotted a tender. In pursuance to this tender and in consonance with the requirements as has been laid down by the Policy decision dated 22.04.2017, the Appellant had been called upon to deposit an amount of Rs.54,12,960/- being 10% amount of the deposited title amount of Rs.5,41,29,600/- in favour of the District Mineral Foundation Trust, Kanpur (hereinafter, “DMF Trust”) apart from 2% stamp fee on the same vide Demand Notice dated 25.10.2017. It needs mention here that as per the terms for allotment and the Mining Permit dated 16.10.2017, the Appellant as required, had deposited the amount payable for the approved mining quantity at the rate of Rs.630/- per cubic meter of sand as per his bid totalling Rs.5,41,29,600/-.

4. This Demand Notice dated 25.10.2017 had been challenged by the Appellant before the High Court through a writ petition asserting that the said amount as has been claimed would be contrary to the provisions of Section 9B of the Mines and Minerals (Development and Regulation) Act, 1957 (hereinafter, “1957 Act”), which required deposit of the amount as per the royalty fixed in Second Schedule of the 1957 Act. The said challenge before the High Court failed vide the Impugned Judgment dated 15.11.2017 leading to the filing of the present appeal.

5. The learned Senior Counsel for the Appellant has asserted that the Policy decision dated 22.04.2017 itself is not sustainable as the due process for issuance thereof as provided for in Rule 68 of the Uttar Pradesh Minor Minerals (Concession) Rules, 1963 (hereinafter, “1963 Rules”) have not been adhered to. Going by and referring to the said Rule, it has been submitted that it enables relaxation of the Rules whereas by way of the impugned Policy in fact the amount which has been claimed is much more than the one which has been fixed in First Schedule, as appended along with the 1963 Rules. He, therefore, asserts that the Policy as well as the Demand Notice is unsustainable.

6. Referring to Section 9B of the 1957 Act, it has been contended that the DMF, as has been formulated and conceptualized, provides for charging and deposit of amount in addition to the royalty equivalent to such percentage of the royalty paid in terms of the Second Schedule of the 1957 Act which would not be exceeding one-third of such royalty, as may be prescribed by the Central Government. He asserts that going by the said Schedule, when rate has been fixed by the State at 10% of the royalty, the amount payable would be limited to that extent and the demand on the bid amount as a whole is unsustainable. Apart from that, reference has also been made to Section 15 of the 1957 Act, which confers powers on the State Government to make Rules in respect of minor minerals. H