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1988 Supreme(Del) 209
High Court Of Delhi
DHARAMVIR - Appellant
Versus
UNION OF INDIA - Respondent
Civil Writ 411 of 1987
Decided On : 08/17/1988
Anuradha Kaushik, C.M.NAYAR, KAPIL SIBAL, Mahabir Singh, P.P.Rao, RAVINDRA BANA, S.C.MOHANTY, VAZIR SINGH
The State Government cannot terminate a mining lease without giving the lessee a notice and an opportunity of hearing, as required under section 4a of the Mines and Minerals (Regulation and Development) Act, 1957.
Headnote:
MINES AND MINERALS - LEASE - PREMATURE TERMINATION - SECTION 4A OF THE MINES AND MINERALS (REGULATION AND DEVELOPMENT) ACT, 1957 - NOTICE AND OPPORTUNITY OF HEARING - NATURAL JUSTICE - INTERPRETATION OF CLAUSE 3(A) OF THE LEASE DEED - POWER OF THE STATE GOVERNMENT TO TERMINATE THE LEASE - OWNERSHIP RIGHTS OF THE STATE GOVERNMENT - WRIT OF CERTIORARI - EXCLUSION OF THE PERIOD OF UNLAWFUL INTERRUPTION FROM THE TERM PERIOD OF THE LEASE - FORCE MAJEURE - SPECIFIC PERFORMANCE - SECTION 14(1)(C) OF THE SPECIFIC RELIEF ACT - WRIT OF MANDAMUS.
Fact of the Case:
The petitioner, who was granted a three-year lease for mining silica and ordinary sand, challenged the order of the State Government terminating the lease under clause 3(a) of the lease deed, which provided for termination in case Haryana Minerals Ltd. or any other public sector undertaking applied for a mining lease over the area and the State Government acted under section 4a of the Mines and Minerals (Regulation and Development) Act, 1957. The State Government had granted a mining lease to Haryana Minerals Ltd. for the same area and terminated the petitioner's lease.
Finding of the Court:
The court held that the State Government could not terminate the petitioner's lease without giving him a notice and an opportunity of hearing, as required under section 4a of the Act. The court interpreted clause 3(a) of the lease deed to mean that the State Government had to comply with the provisions of section 4a before terminating the lease. The court also held that the State Government's ownership rights did not give it the power to terminate the lease without following the procedure prescribed in the Act and the Rules. The court further held that the petitioner was entitled to exclusion of the period of unlawful interruption from the term period of the lease, as the interruption was caused by the illegal act of the State Government.
Issues: 1. Whether the State Government could terminate the petitioner's lease without giving him a notice and an opportunity of hearing, as required under section 4a of the Act? 2. Whether clause 3(a) of the lease deed could be interpreted to mean that the State Government did not have to comply with the provisions of section 4a before terminating the lease? 3. Whether the State Government's ownership rights gave it the power to terminate the lease without following the procedure prescribed in the Act and the Rules? 4. Whether the petitioner was entitled to exclusion of the period of unlawful interruption from the term period of the lease?
Ratio Decidendi: 1. Section 4a of the Act requires the State Government to give the lessee a notice and an opportunity of hearing before terminating the lease. 2. Clause 3(a) of the lease deed cannot be interpreted to mean that the State Government did not have to comply with the provisions of section 4a before terminating the lease. 3. The State Government's ownership rights do not give it the power to terminate the lease without following the procedure prescribed in the Act and the Rules. 4. The petitioner is entitled to exclusion of the period of unlawful interruption from the term period of the lease.
Final Decision: The court allowed the petition, quashed the impugned order, issued a writ of mandamus to the respondent to restore possession to the petitioner immediately, and directed that the period of unlawful interruption shall be excluded in computing the three-year term of the lease.
( 1 ) IN this writ petition the petitioner is challenging the Order of the Commissioner and Secretary to the Government of Haryana, Industries Department dated 3 4th July, 1986 terminating the minnig lease for silica/ordinary sand granted to him.
( 2 ) THIS order also dispose of civil writ petition Nos. 409, 410 and 1367of 1987 as those petitions involve similar points of law and tast, pertaining to "non-observance of the principles of natural justice and non-compliance with the prefecisional requiment of section 4-A".
( 3 ) ON 29th June. 1984, the Haryana Government issued a notification under rule 59 of the Mineral Concessions Rules, 1960 (hereinafter rectrred to as "the Rules") inviting applications for mining and entrading industrial grade "silica Sand" as well as "ordinary Sand" in respect of certain notified areas. The notification provided, inter alia, that the applicant would have to apply for both varietiesof sands in the interest of harmonious and systematic working.
( 4 ) THE petitioner applied for and secured three year leases for mining silica and ordinary sand in respect of the area mentioned in The petitioner. by two separate deeds. After being put into possession, the petitioner spent large sums of monies in building roads and infrastructure start operating the mines.
( 5 ) THE lease pertaining to silica sand which was demised to the petitioner from 8th November, 1985 for a term of three years contained new provision in clause 3 (a) pertaining to termination. This clause, which was not there in earlier leases, reads as follows -
(A) In case Haryana Minerals Ltd. a Public Sector Undertakingn of the State Government or any other Public Sector Undertaking, applies for a mining lease over the area herein leased, during the operation of lease and if the State Government acts under section 4a of the Mines and Minerals (Regulation and Development) Act, 1957, the lease shall stand terminated from the date on which the State Government issues a notice to the lessee under this clause and the lessee shall, immediately on receipt of a notice, hand-over the possession of the area demised herein, to the State Government. ".
( 6 ) THE State Government has purported to act under this clause. The stand of the State Goverment is that in view of clause 3 (a) of the lease deed, the moment Haryana Minerals Ltd. or any other public sector undertaking applies for the grant of a mining lease for the area, the State Government can automatically grant a lease to the said Corporation and terminate the lease of the petitioner. In fact. this is what they have purported to do by the order of 14th July, 1986. The order of termination is as follows :
TERMINATION of mining leases for silica ordinary sand of in terms of clause 3 (a) Part VIII of the Lease Deed for silica sand. Whereas you were granted leases for the extraction of silica sand and ordinary sand for a period of three years from 50 hectares of land situated in village Pali, in terms of lease deed executed by you with the State Government on 8-11-85, and Whereas Haryana Minerals Limited, a State Government Undertaking, has applied for the grant of mining leases for silica/ ordinary sand from 50 hectares of land in village Pali and the State Govt. has granted mining leases for the same area to it, namely, Haryana Minerals Limited vide their Order No. IBII 86/24419-A dated 14-7-1986. Now, therefore, in terms of the provisions of Section 4a of the Mines and Minerals (Regulation and Development) Act, 1957 read with clause 3 (a) of Part VIII of the lease deed, the State Government hereby terminates your "cases for the extraction of silica and ordinary sand from 50 hectares of land in village Pali for the remaining period with immediate effect. You arc, therefore, called upon to hand over possession of the aforesaid plot forthwith to the General Manager, District Industries, Centre, Faridabad. "
( 7 ) IT is apparent from the said order of termination that on the application of
