2018 Supreme(P&H) 879

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
SURYA KANT, SUDHIR MITTAL, JJ.
Baljit Singh - Petitioner
Versus
State of Punjab and others - Respondents
CWP No. 12664, 13166, 13553, 13579, 13578, 13530, 13428, 13574, 13573, 13586, 13509, 13510, 13511, 13512, 13570, 13571, 13572, 13587, 13588, 13508, 13522, 13567, 13427, 13311, 13521, 13577, 13531, 13581, 13583, 13585, 13580, 13584, 13524, 13523, 13590, 13568, 13569, 13564, 13532, 13994, 14002, 13264, 13426, 13513, 13514, 13515, 13516, 13517, 13518, 13519, 13520, 13525, 13526, 13527, 13533, 13563, 13565, 13566, 13575, 13576, 13582, 13589, 13591, 25701, 25703, 25733, 25734, 25736, 25755, 25775, 25779, 25786, 25790, 25838, 25839, 26001, 26263, 26266, 26292, 26306, 13993, 13996, 14003 of 2017 (O&M)
Decided On : 12-01-2018

Headnote:

HEADNOTE : [KEYWORD] - [SUBJECT] - [ACT SECTION LIST] - [SUMMARY] Provide a concise Summary on Fact of the Case, Finding of the Court (Court Analysis and Conclusion), Issues, Ratio Decidendi and Final Decision from Judgement as Headnote. Output should be : [FACT OF THE CASE] [FINDING OF THE COURT] [ISSUES] [RATIO DECIDENDI] [FINAL DECISION]

Fact of the Case:

The petitioners are holders of contracts permitting them to mine minor minerals in the State of Punjab. Their common grievance is that the State of Punjab, by virtue of the impugned notices, has asked them to either surrender their existing contracts or to execute a fresh contract at the rate, at which mines within the Districts, have been given for prospecting of minor or minerals by auction through ‘progressive bidding’; in the absence of any mines having been auctioned by ‘progressive bidding’ within the District, at the auction rate of adjoining District.

Finding of the Court:

The Court held that the State was entitled to change its policy and such a changed policy is applicable to existing contracts. The impugned action has been taken pursuant to a changed policy and therefore, is legal and permissible in law.

Issues: 1. Whether the Cabinet decision dated 19.04.2017 is applicable to the case of the petitioners? 2. Whether the terms of a subsisting contract can be changed in exercise of administrative powers? 3. Whether the decision of the Cabinet is in public interest? 4. Whether the impugned decision is arbitrary and unreasonable? 5. Whether the action is mala-fide, intended to oust the existing licensees? 6. Whether no opportunity of hearing has been granted before passing the impugned orders? 7. Whether the changed policy cannot be applied retrospectively? 8. Whether there is a violation of the doctrine of legitimate expectation?

Ratio Decidendi: 1. The Cabinet decision dated 19.04.2017 is applicable to the case of the petitioners because the Memorandum submitted to the Cabinet clearly shows that the principle objectives were to curb illegal mining, to reduce spiralling prices, to maximize production of minor minerals and to augment State revenue. These objectives are in consonance with Article 39(a) and (b) of the Constitution of India and therefore, the Court held that the policy decision dated 19.04.2017 (Annexure P-15) is in public interest. 2. The terms of a subsisting contract can be changed in exercise of administrative powers because the Statutory Scheme is to create a ‘regulatory regime’ in respect of prospecting of mines and minerals because minerals, both major and minor, are the wealth of the Nation and their prospecting must be regulated in public interest. Therefore, mines and minerals must be prospected wisely, so that optimum revenue can be earned by the State. The word ‘regulate’ includes within its meaning not only action prescribed by the statute, but also embraces within itself the powers incidental to such regulation including varying or even destroying existing and subsisting contracts. 3. The impugned decision is not arbitrary and unreasonable because the petitioners were given the choice to either carry on prospecting under the changed conditions or to exercise their right under Rule 39 and surrender the contract. It is difficult for the Court to hold that the first option is no option at all because as discussed earlier, an option had been given to the petitioners to take the amount, which they would have earned during the balance period of the contract in advance and surrender the mine. The petitioners chose to contest the case instead, clearly indicating that the excuse of inability to carry on prospecting under changed conditions, was merely a red herring. Thus, a workable option was given by the State and therefore, the Court cannot hold that in fact there was only one option of surrender available to the petitioners. 4. No opportunity of hearing is required to be given to the petitioners because the right of hearing, in such a situation, is not vested in the petitioners. The law permits the Government to change the terms of a contract during its subsistence and the concept of opportunity of hearing is not attracted unless some provision of the Acts or the Rules provides for the same. The petitioners could have claimed a right of hearing in case there was a termination of their subsisting contract, but such a right cannot be claimed once the Court has already held that no premature termination is involved in this case. 5. The policy decision cannot apply retrospectively because there is no vested right in the petitioners to continue prospecting without any change in conditions of the contract. Moreover, the petitioners are not being asked to pay the price determined by ‘progressive bidding’ with effect from the date of their contract. The Court is unable to understand the basis of the argument of ‘retrospectivity’. The terms of the contract are liable to be changed in accordance with law and the petitioners are being asked to accept the method of ‘progressive bidding’ prospectively. 6. There is no violation of the Doctrine of Legitimate Expectation because no promise has ever been held out by the State that the terms of the contract would not be changed during its subsistence. On the contrary, the provisions of the Act, Rules, E-auction notice and conditions of Form-L show that statutorily the State could alter the terms of an existing contract.

Final Decision: The writ petitions were dismissed, however, without any order as to costs.