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2025 Supreme(SC) 1678
SUPREME COURT OF INDIA
J.B. Pardiwala, R. Mahadevan, JJ.
Coal India Ltd. And Ors. – Appellants
Versus
M/s Rahul Industries And Ors. – Respondents
Civil Appeal No. 11793 of 2025 (Arising from SLP (C) No. 21888 of 2012) With T.C.(C) No. 10 of 2016 T.C.(C) No. 9 of 2016 T.C.(C) No. 11 of 2016 T.C.(C) No. 27 of 2016 T.C.(C) No. 28 of 2016 T.C.(C) No. 26 of 2016 T.C.(C) No. 33 of 2016 T.C.(C) No. 35 of 2016 T.C.(C) No. 36 of 2016 T.C.(C) No. 34 of 2016 T.C.(C) No. 39 of 2016 T.C.(C) No. 37 of 2016 T.C.(C) No. 40 of 2016 T.C.(C) No. 41 of 2016
Decided On : 12-09-2025
For the Appellant(s) : Mr. Kedar Nath Tripathy, AOR Mr. Aditya Narayan Tripathy, Adv. Mr. Chinmoy Pradip Sharma, Sr. Adv. Mr. Amit Meharia, Adv. Ms. Tannishtha Singh, Adv. Mr. Abinash Agarwal, Adv. Mr. Irfan Hasieb, Adv. Mr. Krishnajyoti Deka, Adv. Mr. Sambhav, Adv. Mr. Vijay Deora, Adv. Mr. Manish Kumar Saran, AOR Ms. Ananya Tyagi, Adv. Mr. Rao K R, Adv.
For the Respondent(s): Mr. Ravi Bharuka, AOR Ms. Aishwarya Bhati, A.S.G. Mr. Gp. Capt. Karan Singh Bhati, AOR Ms. Chitrangda Rastravara, Adv. Mr. Hemendra Sharma, Adv. Mr. Abhijeet Singh, Adv. Mr. Anirudh Singh, Adv. Mr. Yogeshwar Krishna Purohit, Adv. Mr. Aishwary Mishra, Adv. Mr. Dhananjai Shekhwat, Adv. Ms. Anjali Saxena, Adv. Mr. Dashrath Singh, Adv. Mr. Anupam Lal Das, Sr. Adv. Mr. Amit Sharma, AOR Mr. Dipesh Sinha, Adv. Mr. Dipesh Sinha, Adv. Ms. Pallavi Barua, Adv. Ms. Pallavi Barua, Adv. Ms. Aparna Singh, Adv. Mr. Manish Kumar Saran, AOR Mr. Sidhant Sharma, Adv. Mr. Aditya Mani Saran, Adv. Ms. Ananya Tyagi, Adv.
The Interim Coal Policy validly imposed a 20% price increase on linked non-core consumers, aimed at sustaining coal supply, not solely for profit, and refund claims require proof that price burdens were not passed to consumers.
Headnote:(A) Coking Coal Mines (Nationalization) Act, 1972 - Coal Mines (Nationalization) Act, 1973 - Essential Commodities Act, 1955 - Interim Coal Policy - Challenge by linked consumers of non-core sector against 20% price increase introduced by the Interim Coal Policy - Court upheld that the appellant was empowered to notify the policy given the legislative background - Concluded that the policy aimed to sustain coal supply and was valid under Articles 14 and 39(b) of the Constitution, not solely motivated by profit - No entitlement to refund for consumers who moved before the court without proving that the burden of price increase was not passed on to end users. (Paras 108-148)
(B) Regulatory Authority - Judicial Review of Economic Policy - The courts should not substitute executive policy decisions unless they violate constitutional provisions or are arbitrary. (Paras 79-87)
| Table of Content |
|---|
| 1. factual background of the coal sector and policies. (Para 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14) |
| 2. challenge to the interim coal policy by respondents and high court's questions. (Para 19 , 20 , 21) |
| 3. submissions and arguments of the appellant and respondents. (Para 25 , 39 , 40 , 41) |
| 4. judicial principles regarding price fixation and constitutional obligations. (Para 52 , 54 , 56 , 60 , 62 , 68) |
| 5. determination of the validity of the interim coal policy. (Para 110 , 113 , 114) |
| 6. conclusion regarding the validity and implications of the interim coal policy. (Para 144 , 146 , 147) |
JUDGMENT :
J.B. PARDIWALA, J.
For the convenience of exposition, this judgment is divided into the following parts:
INDEX
| A. | FACTUAL MATRIX |
| B. | SUBMISSIONS OF THE PARTIES |
| (a) Submissions of the appellant in its petition under Article 136, I.A. No. 1 of 2015 and additional affidavits | |
| (b) Written submissions of the respondents | |
| C. | ISSUES FOR DETERMINATION |
| D. | ANALYSIS |
| (i) Analysis of the observations of this Court in Ashoka Smokeless (supra) | |
| a. Objective of the e-auction system | |
| b. Submissions of the petitioners in Ashoka Smokeless (supra) | |
| c. Reasonableness of dual pricing of coal | |
| d. E-auction system is unconstitutional | |
| e. Coal companies empowered to notify price of coal | |
| f. Conclusions reached in Ashoka Smokeless (supra) | |
| (ii) Analysis of the observations of this Court in Pallavi Refractories (supra) | |
| (iii) The general rule as regards the scope of enquiry by courts into the economic policy of the State | |
| (iv) Objective of the Interim Coal Policy subserved the’ common good’ | |
| (v) Balancing between the respondents’ fundamental rights and the interests of the public at large | |
| a. Applicability of the Proportionality test vis-à-vis the Reasonable classification test | |
| b. Applicability of the rational nexus test to the case on hand | |
| (vi) Determination of the issues framed | |
| Whether the appellant had the authority to notify the Interim Coal Policy, in terms of the dictum of this Court in Ashoka Smokeless (supra)? | |
| Whether the increase of 20% over and above the notified price introduced in the Interim Coal Policy for the linked consumers of the non-core sector was valid in terms of Article 14? | |
| Whether the respondents are entitled to refund of the 20% additional cost? | |
| E. | CONCLUSION |
1. Leave granted in Special Leave Petition (C) No. 21888 of 2012.
2. Since the issues raised in the captioned appeal and the transferred cases are the same, those were taken up for hearing analogously and are being disposed by this common judgment and order.
3. This appeal arises from the Judgment and Order passed by the High Court at Calcutta dated 04.04.2012, in A.P.O. No. 10 of 2011 (the “impugned judgment”), by which the division bench of the High Court dismissed the appeal filed by the appellant herein and thereby affirmed the order passed by a learned Single Judge dated 25.11.2010 in the Writ Petition No. 44 of 2007, holding that the appellant herein had no authority to frame and notify the Interim Coal Policy dated 15.12.2006 and thereby collect an excess of 20% amount over and above the notified price of coal from the linked consumers falling in the non-core sector, in light of this Court’s dictum in Ashoka Smokeless Coal India (P) Ltd. v. Union of India, reported in (2007) 2 SCC 640.
A. FACTUAL MATRIX
4. The appellant herein is a public sector undertaking involved in the mining, production and marketing of coal and its products. It falls under the administrative control of the Ministry of Coal, Government of India. The respondents herein (original writ petitioners) are private limited companies engaged in the business of manufacturing of smokeless fuel for which coal is the raw material.
5. The respondents had challenged the Interim Coal Policy notified by the appell
