Point of law: Profit earned by illegal mining i.e. carrying on mining operations contrary to the 1957 Act or the rules framed thereunder, would by no means be a safe criteria for determining the amount of compensation.

JUDGMENT :

These Miscellaneous First Appeals are filed by a common appellant-M/s. Bagalkot Cement & Industries Limited, aggrieved of the common judgment dated 25.04.2019 passed in LAC No.173 of 2003 and connected matters by the II Additional Senior Civil Judge & JMFC, Bagalkot (hereinafter referred to as ‘Reference Court’ for short) under the provisions of Section 18 of the Land Acquisition Act, 1894 (hereinafter referred to as ’the L.A. Act’) rejecting the claim of the appellant for award of compensation in respect of the sub-soil/minerals underneath the soil of the acquired properties. Since the parties to the proceedings are common and the issue raised is also common, these appeals are disposed of by this common judgment.

2. At the threshold, we should make it clear that although prayers are made in all these appeals seeking enhancement of compensation even in respect of the acquired lands (top-soil), nevertheless, no arguments have been canvassed on behalf of the appellant in that regard. Therefore, these appeals are confined to the issue as to whether the appellant is entitled for award of compensation in respect of the minerals lying underneath the sub-soil of the acquired lands.

3. Earlier too, the appellant was before this Court by filing MFA Nos.20112/2011 (LAC) c/w 20113-20120/2011 (LAC) aggrieved by the common judgment passed by the Reference Court in LAC No.173 of 2003 and connected matters, wherein the Reference Court enhanced the compensation at Rs.630/- per sq.mtr. in certain cases and in certain other cases at Rs.800/- per sq.mtr. and Rs.880/- per sq.mtr. along with 12% additional market value on the enhanced compensation amount from the date of 4(1) notification till the date of possession. 30% solatium was also granted on the enhanced market value. Further, in terms of Section 28 of the L.A.Act, the interest on the compensation was directed to be paid at the rate of 9% per annum on the enhanced compensation amount for the 1st year and thereafter at the rate of 15% per annum for the subsequent years till deposit of the enhanced compensation amount. This Court having found that since sufficient evidence is not available on record in respect of the extent of limestone deposit beneath the sub-soil, the matter requires reconsideration at the hands of the Reference Court. It was also held that the Reference Court was required to take into consideration various judgments considered by this Court, including the case of Thressiamma Jacob and Others Vs. Geologist, Department of Mining and Geology and Others, (2013) 9 SCC 725 and consider whether the appellants were entitled for award of compensation in respect of the minerals lying beneath the sub-soil. On remand, fresh evidence were lead on behalf of the appellant-company examining 7 witnesses and several documents were also got marked. Having regard to the judgments cited by the learned Counsels, including the case of Thressiamma Jacob (supra), the Reference Court was of the opinion that the appellant-company was not holding a valid mining licence and the mining activities were carried on without a valid licence. Accordingly, the claims of the appellant for compensation in respect of the limestone deposits were rejected.

4. The learned Advocate General appearing on behalf of the respondents submitted that one important provision of law which would clearly establish the sovereign rights of the minerals lying beneath the sub-soil in favour of the State is Section 70 of the Karnataka Land Revenue Act, 1964. On the other hand, learned Senior Counsel Sri. Ashok S. Haranahalli, appearing on behalf of the appellant submitted that there is a separate enactment which deals with the grant of compensation in respect of the mines and minerals in The Land Acquisition (Mines) Act, 1885. Learned Senior Counsel submitted that in terms of the said statute and its provisions, more particularly, Section 3, whenever a notification is published under Section 6(1) of the L.A.Act, a declaratio