Point of Law: minor minerals removed from the quarries, admittedly are the property of the government and the same cannot be removed and used without payment of royalty. It is therefore the duty of the government to ensure that only royalty paid minerals are used in the work and the purpose of issuing such circular was to avoid pilferage/leakage of revenue because royalty can be very conveniently evaded by the contractors either by not purchasing the material from the mining leaseholders or obtaining it from unauthorized excavators

JUDGMENT :

1. We have heard Shri Ashok Khare, learned Senior Counsel assisted by Shri Siddharth Khare, counsel appearing for the petitioner; and Shri Pradeep Kumar Tripathi, learned Standing Counsel appearing for the State - respondents.

2. By this writ petition, a challenge has been made to the Government Order dated 15.10.2015 and the order of the Engineer-in-Chief (Development & Head of Department), Public Works Department dated 26.08.2019.

3. It is stated that the petitioner is "A" class Contractor, executing work of Public Works Department, apart from others. He is using the minerals for execution of contract work. It is after compliance of the provisions of Uttar Pradesh Minor Minerals (Concession) Rules, 1963 (hereinafter referred to as, 'the Rules of 1963'). He may be subjected to deduction of royalty six times to the amount of royalty pursuant to the Government Order of 15.10.2015. The direction has been given therein to deduct the amount of royalty to the extent of five times to the royalty amount in case it is found that the mineral has been used without a valid transit pass on Form MM-11. The deduction amount to be from the bills of the Contractor.

4. The counsel for the petitioner states that in case a Contractor fails to produce required documents to prove payment of royalty, it cannot suffer with payment of royalty apart from an amount five times to the royalty in absence of any provision under the Rules. Thus, the order dated 15.10.2015 and the consequential order of Engineer-in-Chief are illegal, thus deserve to be set aside.

5. The writ petition has been contested by the side opposite. It is submitted that the issue raised in this writ petition is not open for debate having been decided by this Court in the case of Ayodhya Prasad Mishra Vs. State of U.P. & Others [reported in 2016 (11) ADJ 607 (DB)]. Therein, the same circular was challenged. The writ petition, therein, was dismissed, though with certain clarifications. A reference of the judgment of the Apex Court in the case of State of Rajasthan & Another Vs. Deep Jyoti Company & Another [(2016) 6 SCC 120] has also been given to show that similar circulars were not interfered by the Apex Court.

6. Clarifying the fact, it is submitted that anyone using the mineral is under an obligation to see that it is royalty paid. The obligation for payment of royalty is on the lease-holder and whenever mineral is transported, it should be under the valid transit permit on the required form and thereupon only, the mineral can be used by the Contractor. In case of default in making the payment of royalty and thereby, valid transit pass could not obtain by the transporter yet mineral is used by the Contractor, he is made liable to payment of royalty to the extent of five times by way of deduction in the bills. The five times to the royalty is nothing but the value of the mineral used without the payment of royalty amount. The deduction, to the extent of five times, is only to recover the value of mineral used without the payment of royalty amount, as it is the property of the Government, but can be used, subject to payment of royalty.

7. The basis of five times royalty is in reference to section 21(5) of the Mines & Minerals (Development & Regulation) Act, 1957, has been given and for ready reference, the said provision is quoted hereunder:-

“Section 21. Penalties:-

(5) Whenever any person raises, without any lawful authority, any mineral from any land, the State Government may recover from such person the mineral so raised, or, where such mineral has already been disposed of, the price thereof, and may also recover from such person, rent, royalty or tax, as the case may be, for the period during which the land was occupied by such person without any lawful authority.]

[(6) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), an offence under sub-section (1) shall be cognizable.”

8. The Government has taken five times to the royalty to be the pric