Back
2006 Supreme(Mad) 750
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE P.K. MISRA
M/s.Sun Industries, Rep.by its Proprietor - Appellant
Versus
The State of Tamil Nadu, Rep.by its Secretary to Government & Another - Respondents
Writ Petition No.9477 Of 2004
Decided On : 17 March 2006
The court emphasized that the right of renewal for a mining lease is for the period applied for by the lessee, and the government does not have the discretion to renew it for a period lesser than the period applied for, as per Rule 24-B of the Mineral Concession Rules.
Headnote:
Renewal - Mining Lease - Rule 24-B of the Mineral Concession Rules - [24-B] - The court discussed the provisions of Rule 24-B of the Mineral Concession Rules, which entitle the lessee to renewal of a mining lease for a period not exceeding 20 years, unless a lesser period is applied for. The court emphasized that the right of renewal is for the period applied for by the lessee, and the government does not have the discretion to renew it for a period lesser than the period applied for. The court held that the petitioner's right for renewal for the maximum period permissible should have been upheld, and the rejection of the renewal application based on the reservation of the land in favor of another entity was not applicable since the original period of renewal was for 20 years.
Fact of the Case:
The petitioner was initially granted a mining lease for quarrying Limestone over an extent of 5.29 acres. The lease was extended for a period of 10 years, and the petitioner applied for further renewal, which was rejected based on the reservation of the land for exploitation by another entity.
Finding of the Court:
The court allowed the writ petition and quashed the order rejecting the renewal application, emphasizing that the rejection based on the land reservation was not applicable since the original period of renewal was for 20 years.
Issues: The main contention was the rejection of the renewal application based on the reservation of the land for exploitation by another entity, and the interpretation of Rule 24-B of the Mineral Concession Rules regarding the entitlement to renewal of a mining lease.
Ratio Decidendi: The court held that the right for renewal for the maximum period permissible should have been upheld, and the rejection based on the land reservation was not applicable since the original period of renewal was for 20 years.
Final Decision: The court quashed the order rejecting the renewal application and directed that the lease shall continue till the period of expiry of 20 years from the initial grant, or the petitioner shall be permitted to have a further renewal of 10 years from the date of fresh issuance of the order passed by the appropriate authority.
(Petition filed under Article 226 of the Constitution of India for the issuance of writ of Certiorarified Mandamus calling for the records on the file of the 1st respondent in his order in G.O.(D)no.50 Industries (MMD2) Department dated 5.3.2004 and quash the same and consequently direct the 1st respondent to reconsider the petitioner’s renewal application on its own merits and in accordance with law in respect of Limestone quarry situated in S.No.270/2B over an extent of 5.29 acres in Pandapuli Village, Sankaran Koil Taluk, Tirunelveli District.)
The facts giving rise to the present writ petition are as follows:-
The petitioner was initially granted mining lease for quarrying Limestone over an extent of 5.29 acres in S.No.270/2B in Pandapuli Village, Sankarankoil Taluk in Tirunelveli District for a period of three years. The lease deed was executed on 18.8.1983 and the period of lease was to expire on 17.8.1986. Subsequently, the petitioner applied for grant of renewal of the said lease for a period of 20 years. The District Collector and the Director of Geology and Mines recommended for grant of renewal for a period of 10 years. Considering the recommendation, the Government granted extension over the said area for a period of 10 years with effect from 18.8.1986. Thereafter the petitioner filed further application for renewal for further period of 10 years. However, such application for renewal was kept pending on some ground or the other and ultimately it was rejected under the impugned order dated 5.3.2004 mainly on the ground that the area in question has been kept reserved for exploitation by the Government through Tamil Nadu Cements Corporation Limited by G.O.Ms.No.672 Industries (MMD.2) dated 31.8.1999. Such order is being challenged in the present writ petition.
2. The main contention raised by the learned counsel appearing for the petitioner is to the effect that the basic reason for rejection of the renewal application is untenable as G.O.Ms.No.672 dated 31.8.1999 itself indicates that such reservation in favour of Tamil Nadu Cements Corporation Limited would not be applicable to the area already held under the prospecting licence or mining lease. It is further submitted in this connection that without first deciding about the extension of lease in favour of the petitioner, such land should not have been reserved for exploitation by Tamil Nadu Cements Corporation Limited. Learned counsel appearing for the petitioner has pointed out that as per the provisions contained in Rule 24-B of the Mineral Concession Rules, the person is entitled for the period claimed by him not exceeding 20 years.
3. In the counter affidavit it is contended that even though the lease could have been extended for a maximum period of 20 years, the Government in its discretion extended lease for a period of 10 years and such lease must be taken to have been expired on expiry of 10 years from 1986 and therefore it cannot be said that the said area was not covered under the notification dated 31.8.1999, reserving the area for exploitation by the Tamil Nadu Cements Corporation Limited.
4. Rule 24-B of the Mineral Concession Rules, being relevant is quoted hereunder:-
“24-B. Renewal of mining lease in favour of a person using the mineral in his own industry.- Every person who is holding a mining lease for a mineral which is used in his own industry shall be entitled for the renewal of his mining lease for a period not exceeding 20 years unless he applies for a lesser period.”
5. The first renewal was granted on 29.8.1990 for a period of 10 years with effect from 18.8.1986. From such order it is apparent that the petitioner had applied for renewal for a period of 20 years and not for a lesser period. A fair reading of Rule 24-B makes it clear that a right of renewal is vested with the lessee if he is using the mineral for his own industry. However, such renewal cannot exceed for more than 20 years. The expression “unless he applies for a lesse
