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2024 Supreme(Raj) 395
IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR
MANINDRA MOHAN SHRIVASTAVA, C.J., SHREE CHANDRASHEKHAR, J.
Birla Cement Works, (A Unit of Birla Corporation Limited) - Appellant
Versus
The State of Rajasthan, Through The Principal Secretary, Department of Mines and Geology, Government of Rajasthan & Ors. - Respondents
D.B. Spl. Appl. Writ No. 685 of 2024
Decided On : 16-07-2024
For the Appellant :Mr. Vikas Balia, Sr. Advocate assisted by Mr. Akhilesh Rajpurohit.
For the Respondent: Mr. Mahaveer Bishnoi, AAG.
IMPORTANT POINT
The definition of 'run of mine' under the Mineral Concession Rules includes all excavated materials, including mineral rejects, which must be accounted for in total production calculations, thereby justifying penalties for exceeding production limits.
Headnote:
MINING LAW - MINERAL CONSERVATION AND DEVELOPMENT - Mineral Conservation and Development Rules 2017, Mineral Concession Rules 2016, Mines and Minerals (Development and Regulation) Act, 1957 - The court discussed the definitions of 'run of mine' (ROM) under the Mineral Concession Rules of 2016 and 1960, emphasizing that ROM includes all excavated materials, including mineral rejects. The court upheld the imposition of a penalty for excess production, interpreting the relevant rules to include all materials obtained from mining operations, thereby affirming the authority's decision to penalize the appellant for exceeding the environmental clearance limits. The court's interpretation of the definitions influenced its decision to dismiss the appeal, reinforcing the legal framework governing mining operations and environmental compliance.
Fact of the Case:
The appellant, Birla Cement Works, challenged a penalty of Rs.2,77,05,522 imposed by the Mining Engineer for exceeding limestone production limits set by environmental clearance. The penalty was based on findings of violations of the Mineral Conservation Rules during inspections. The appellant contended that the production should exclude mineral rejects, while the authorities maintained that all excavated materials, including rejects, counted towards total production.
Finding of the Court:
The court found that the definitions of 'run of mine' and 'production' under the applicable rules included all excavated materials, including mineral rejects. The court upheld the authority's decision, stating that the appellant's interpretation was flawed and that the imposition of the penalty was justified based on the evidence presented.
Issues: Whether the definition of 'run of mine' excludes mineral rejects for the purpose of calculating total production and whether the penalty imposed for excess production was justified.
Ratio Decidendi: The court held that the definition of 'run of mine' under the Mineral Concession Rules of 2016 includes all excavated materials, and thus, mineral rejects must be considered in calculating total production. The authority's interpretation of the rules was deemed correct, and the penalty was upheld as lawful.
Final Decision: The court dismissed the special appeal, affirming the penalty imposed on the appellant for exceeding the production limits as per the environmental clearance.
JUDGMENT :
Shree Chandrashekhar, J.
This Special Appeal seeks to challenge the order dated 30th May 2024 passed in S.B. Civil Writ Petition No.6217 of 2024 by which the order passed by the Mines Tribunal has been affirmed by the writ Court. Before the Mines Tribunal, the challenge laid by the Birla Cement Works (hereinafter to be referred as the “appellant-company”) to the demand notice dated 26th December 2022 issued by the Mining Engineer, Chittorgarh imposing a penalty of Rs.2,77,05,522/- had failed.
2. The appellant-company is a mining leaseholder for captive use of limestone (cement grade) vide Mining Lease No.10/1983 near village Bherda, Jai, Surjana and Nagri within Tehsil and District of Chittorgarh. After online Annual Return for F.Y. 2018-19 was filed by the appellant-company on 19th June 2019 under Rule 45(5)(b)(viii) of the Mineral Conservation and Development Rules 2017 (in short, ‘Mineral Conservation Rules of 2017’), a notice was issued to it by the Indian Bureau of Mines (in short ‘the IBM’) on 19th November 2019 on the ground of violations of the provisions of the Mineral Conservation Rules of 2017 which were found during inspection of the mine on 18th and 19th October 2019. Accordingly, it was put to the notice of the appellant-company that violation of Rule 62 is an offence and the mining operations can be suspended for non-compliance thereof. The response of the appellant-company to the alleged violations was accepted on almost all counts except that the IBM did not agree with its stand that the total production of ‘limestone’ did not exceed the limit of 2.8 MT provided under the Environmental Clearance (in short ‘EC’). Therefore, a notice was issued on 09th January 2020 for initiating a proceeding against the appellant-company for violation of Rules 11(1) and 45(7) of the Mineral Conservation Rules of 2017.
3. After considering the show-cause reply of the appellant-company, the IBM held that the appellant-company had committed violations of the environmental laws and issued directions in this regard to the Director, Department of Mines and Geology, Government of Rajasthan. This followed inter-departmental communications and a demand notice was issued to the appellant-company for Rs.2,77,05,522/- as penalty for excess production. Aggrieved thereby, the appellant-company approached this Court in S.B. Civil Writ Petition No.1881/2023 and that writ petition was disposed of by an order dated 04th April 2023 with liberty to the appellant-company to avail the remedy of revision before the Central Government. However, the Mines Tribunal dismissed the revision petition filed by the appellant-company under Section 30 of the Mines and Minerals (Development and Regulation) Act, 1957 read with Rule 36 of the Minerals (Other Than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016 (hereinafter referred as ‘Mineral Concession Rules of 2016’). In the order dated 03rd April 2024, the revisional authority held that the expression ‘run of mine’ as defined under Rule 2(f) of the Mineral Concession Rules of 2016 is the relevant provision for the purpose of deciding total production by the appellant-company and its reliance on Rule 2(viia) of the Mineral Concession Rules, 1960 was misplaced inasmuch as the said definition was brought through amendment vide notification dated 01st October 2021. The revisional authority observed as under :
“(i) The demand notice of Rs.2,77,05,522/- imposed by the State Government on the Revisionist is on the account of production of the mineral limestone by the Revisionist in years 2004-05, 2005-06, 2006-07 and 201819 being in excess of the quantity permitted under the EC, as determined to be so by the State Government.
(ii) However, the contention of the Revisionist is that the production of the mineral is to be calculated after excluding the mineral rejects.
(iii) Hence, the crux of the matter is really the way "run of mine' is defined.
(iv) The Revisionist has relied on the definition of
