” Heard Mr. N. Dutta, the learned Senior Counsel appearing in the WP(C) No.1832/2009 and WP(C) No. 4482/2008. The other petitioners are represented by Mr. J. Roy, the learned Counsel. The learned Government Advocate Mr. J. Handique appears for the State respondents. The Airport Authority of India (AAI) is represented by advocate Mr. R. Dubey. The respondent Railways are represented by Ms. B. Devi, the learned Standing Counsel.

2. The issue that requires Court” s consideration is whether royalty can be demanded from the contractors for ordinary earth utilized in levelling the low lying areas, in execution of the contracts under the AAI, N.F. Railways and the National Highway authorities. The earth was extracted by the contractors from private patta lands and demand for royalty is made from the contractors and not from the land owners. In 5 cases, [barring the WP (C) No.2177/2066] the work was completed but because of royalty demand, the earnest money is retained by the principal employer except in the WP(C) No.2022/2006 where even the earnest money has been refunded to the contractor on satisfactory conclusion of work. Since common arguments are advanced from both sides, the following judgment will cover all five cases.

3. As relevant aspects in these cases are substantially similar, the facts from the WP(C) No.1832/2009 are delineated for the purpose of this judgment. In this case, the AAI entrusted the work for levelling the low lying areas and development of internal drainage system for the runway extension in the LGBI Airport, Guwahati. To execute the contract, the petitioner made agreements with owners of private patta lands for extracting earth therefrom, to execute the work. The Addl. D.M., Guwahati accorded permission for earth extraction after concurrence of the Forest Department and accordingly the contract was being executed with ordinary earth collected from private patta lands.

4. While the work was on, the notice dated 6.4.2009 (Annexure-9) was issued by the AAI, whereby the contractor was asked to submit documents to confirm that royalty was paid for the extracted earth and failing this, withholding of Rs.75,10,000.00 from their running bills was threatened. Aggrieved by this threat, the contractor filed the WP(C) No.1832/2009 and relied upon this Court” s decision in the Brihattar Dispur Mati Truck Malik Santha v. State of Meghalaya, reported in 2003 (2) GLT 446 to contend that removal of earth from non-forest areas can” t be subjected to forest royalty. Accepting this projection an interim order was passed on 8.5.2009, whereby royalty deduction was stayed from the contractors bills by this Court.

5.1 Assailing the legality of the royalty demand, the petitioners contend that compulsory extraction of royalty can only be made through statutory authorization and when the statute permits collection through a particular manner and from a particular person, it can be collected only in that manner and from the specified person and that too at the stipulated rate and not in any other manner. Moreover, such compulsory levy by the Government can only be in accordance with law and taking statutes will have to be construed strictly by the Court.

5.2 According to the petitioners the demand of royalty must be authorized by law and in the absence of any legislative sanction, the levy can” t be imposed through executive authorization or through interpretive exercise.

5.3 The petitioner refers to the Clause 5.1 of the Special Conditions of Contract to project that royalty is to be paid directly to the Government as was pointedly clarified by the AAI in their clarificatory response to query No.3 and therefore the demand for royalty addressed to the contractor by the AAI is inconsistent with the contract terms.

6.1 The stand of the respondents can be culled out form the 3 applications i.e. Misc. Case 3318/2008 (filed by the AAI), the Misc. Case 3173/2009 and Misc. Case 3145/2009 (both filed by the Principal Chief Conservator