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2024 Supreme(AP) 666

IN THE HIGH COURT OF ANDHRA PRADESH
K. MANMADHA RAO, J.
M/s. Kishore Granites Pvt. Ltd., - Petitioner
Versus
The State of Andhra Pradesh - Respondent
W.P.Nos.29056 and 28142 of 2021
Decided On : 12-08-2024

Advocates Appeared:
For the Petitioner: P. Roy Reddy.

Pre-determined issuance of demand notices violates legal principles requiring fair process, rendering them null and void.

Headnote:(A) Constitution of India - Article 226 - Mines and Minerals (Development and Regulation) Act, 1956 - AP Mines Mineral Concession Rules, 1966 - Challenge to demand notice and cancellation of mining lease - Petitioners sought to quash Demand Notice No. 873/V&E/2020-6 on grounds of pre-determined issuance and lack of jurisdiction - The Court found that the demand notice was issued prior to a fair examination of the evidence or consideration of the petitioners' responses and that the statutory authority had clearly pre-formed its opinion regarding the petitioners' liability. (Paras 9, 21, 23)

(B) Legal Precedents - The court reaffirmed the principle from Siemens Ltd. v. State of Maharashtra regarding the maintainability of writ petitions against pre-determined notices, emphasizing that actions taken without independent statutory authority are null and void. (Paras 10, 22)

(C) Found that the impugned demand notice was not in compliance with statutory provisions, thus holding it null. (Para 23)

Facts of the case:
The petitioner challenged a demand notice for payment of seignorage fees relating to mining lease after multiple prior notices were issued and quashed by the court in earlier proceedings.

Findings of Court:
The court ruled that the demand notice was arbitrary and issued without proper legal authority, thus set aside.

Issues: The main issues related to the pre-determinative nature of the demand notice and the jurisdiction of the issuing authority.

Ratio Decidendi: The court concluded that the authority acted without jurisdiction by issuing a demand based on external influences rather than a fair assessment of facts.

Result: Writ Petitions allowed, demand notice set aside.

Table of Content
1. petitioner seeks to quash mining lease cancellation. (Para 1 , 2 , 3)
2. history of mining lease challenges and violations. (Para 4 , 5 , 6)
3. legal malice and colorable exercise of power. (Para 7 , 8 , 10 , 12 , 14)
4. arguments against jurisdiction and procedural violations. (Para 9 , 11 , 13 , 16)
5. determination process must follow statutory guidelines. (Para 15 , 18 , 19 , 20 , 21)
6. demand notices ruled illegal, petitions allowed. (Para 22 , 23 , 24 , 25)

ORDER :

(K. Manmadha Rao, J.) :

The Writ Petition No.29056 of 2021 is filed under Article 226 of the Constitution of India, seeking the following relief :

    “…..to issue a Writ, Order or Direction more particularly one in the nature of Certiorari by calling for the 2nd repondents Demand Notice No.873/V&E/2020-6, dt.27.10.2021, in respect of the lease hold rights of the petitioner over an extent of 3.093 Hectares in Sy.No.103/P of Konidena (V), Ballikuruva (M), Prakasam District and quash the same…….”

The Writ Petition No.28142 of 2021 is filed under Article 226 of the Constitution of India, seeking the following relief:

    “…..to issue a Writ, Order or Direction more particularly one in the nature of Certiorari by calling for the 2nd respondents Proceedings No.873/V&E/2020-6, dt.27.10.2021, whereby determination (cancellation) was effected of the petitioner’s Mining Leasehold rights pertaining to excavation of colour granite over an extent of 3.093 Hectares in Sy.No.103/P of Konidena (V), Ballikuruva (M), Prakasam District and quash the same…….”

2. Since the petitioner, facts and issues involved in both the writ petitions are one and the same, this Court find it expedient to decide these matters by a common order.

3. The facts in both the writ petitions are similar and identical, therefore, W.P.No.29056 of 2021 is taken as lead case, and the facts therein are referred to for convenience.

4. Brief facts of the case are that the petitioner was granted quarry lease for a period of 20 years i.e., upto 23.08.2026, for excavation of colour granite over 3.0930 Hectares in Survey No.103/P of Konidena Village, Ballikuruva Mandal, Prakasam district, under the provisions of the Mines and Minerals (Development and Regulation) Act, 1956 and the AP Mines Mineral Concession Rules, 1966. While so, a show-cause notice was issued by the Additional Director of Mines and Geology on 13.02.2020, seeking to cancel the quarry lease that had been granted to the petitioner. The same was challenged before this Court in W.P.No.5006 of 2020 and the same was disposed of on 28.02.2020, setting aside the said show-cause notice, while giving opportunity to the competent authority. Therefore, another show-cause notice vide Procdgs No.873/V&E/2020-6, dated 20.03.2020 was issued by the Director of Mines and Geology-2nd respondent, pursuant to the instructions contained in Government Memo dated 29.01.2020 and also a pre-meditated “Alert Note”, dated 03.01.2020 of the Director General, Vigilance and Enforcement (an authority extraneous to the MMDR Act), 1956 and the statutory rules frameed thereunder). Aggrieved by the same, the petitioner filed W.P.No.8515 of 2020 and the same was allowed on 04.03.2021 along with a batch of writ petitions, including W.P.No.13700 of 2020, wherein the Demand Notice dated 31.07.2020 issued to the petitioner was challenged and the said writ petition was allowed on 04.03.2021. Then, another Demand Notice dated 31.07.2020 was issued by 2nd respondent, inspite of pendency of W.P.No.8515 of 2020 and subsistence of interim order therein, calling upon the petitioner to pay seigniorage fee and penalty. The same was challenged in W.P.No.13700 of 2020 and this Court after hearing both sides, suspended the aforesaid demand notice dated 31.07.2020.

5. Again the 2nd respondent issued proceedings dated 20.08.2020, determing (cancelling) the lease of the petitioner. The same was challenged in W.P.No.15077 of 2020 and the same was allowed by this Court on 27.08.2020, setting aside the

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