Mining Contract – It is the duty of the State to identify the land which they offer for mining and ensure that it is not only conducive for the purpose intended but also ensure that the area conforms to the measurements offered for mining

Mr. Mahesh Grover, J. (Oral) - The petitioner by invoking the jurisdiction of this court under Articles 226/227 of the Constitution of India prays for quashing of order dated 10.04.2018 revoking the Letter of Intent dated 06.10.2016 earlier granted to it for the mining contract of ManakTabra Block/PKL-B 20. He has further made a prayer for surrendering the mining contract w.e.f. 15.09.2017 with refund of his security amount.

2. Pursuant to an e-auction held on 02.08.2016 and 03.08.2016 the petitioner applied and gave the highest bid of Rs.04,06,00,000/- per annum for Manak Tabra Block/PKL-B 20 (hereinafter known as ‘the mining area’ falling in Tehsil and District Panchkula spreading over an area of 15.28 hectares of land.

3. As per the terms of the auction, the petitioner deposited 10 per cent of the bid i.e. Rs.40,60,000/- as initial bid as security. Letter of Intent was granted to it on 06.10.2016 so as to enable it to get environmental clearance from the Ministry of Environment, Forest and Climate Change, Government of India and after grant of Letter of Intent on 06.10.2016 the petitioner started formalizing the process of working the mine which he was required to be done within a period of one year from the grant of LOI. During the course of preparation of mining plan as well as environment impact assessment report, which are essential for the environmental clearances, a survey of the area intended for the mining contract was carried out by the petitioner which revealed that no mining operation could be undertaken because of thick afforestation, constructed commercial establishments, cultivation, tube well installations, cremation grounds as also the land in utilisation for grazing animals which in totality consumed 50% of the area offered for mining. In these circumstances, the petitioner after submitting representation has desired to surrender the contract which he now prays that it be accepted.

4. . According to the petitioner, the survey revealed extensive afforestation and commercial establishment besides other obstructions such as tube wells and cremation ground. The details of the area consumed by various activities such as afforestation etc. are as below :-

S. No	Element	Area
1.	Thick Forest.	69-13
2.	Commercial establishment (shops)	17-04
3.	Standing Crops (Land Fit for cultivation	46-00
4.	Tube Well	01-05
5.	Cremation Ground	08-00
6.	Land earmarked for grazing of animals (Gau Charand)	08-00
	Total	150-02 or 7.51 Hectares

5. In support of his plea that the area is under extensive tree plantation which would impede rather make the mining virtually impossible the petitioner has referred to the jamabandi for the year 2015-2016 which describes the land as ‘Zakhira Darataktan’ and similarly describes the land as Chahi (cultivable). Annexure P-4 are the jamabandies describing various portions of land which indeed bear out the claim of the petitioner of the area having extensive tree plantation.

6. The respondents while considering the prayer of the petitioner dated 08.09.2017 for surrender of the mining contract have passed the impugned order declining the prayer and ordering forfeiture. The operative part of the impugned order is as below :-

“11. In view of submissions made by the department and applicant contractor/LoI holder, I am of the considered view that M/s Ghaggar Royalty Company violated terms of auction/LoI dated 06.10.2016 in respect of Boulder, Gravel and Sand of ‘Manak Tabra Block/PKL B-20’ by not executing contract agreement, therefore, the LoI is hereby revoked along with following penal actions :

(i) The amount of Rs.40,60,000/- (Rs.Forty lakh sixty thousand only) deposited at the time of auction by M/s Ghaggar Royalty Company, towards the initial bid security is forfeited;

(ii) The un-paid