SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2022 Supreme(MP) 632

High Court of Madhya Pradesh
Vivek Rusia, Subodh Abhyankar, JJ.
ULTRATECH CEMENT LTD. – APPELLANT
Versus
STATE OF MADHYA PRADESH & ORS. – RESPONDENTS
W. P. (S) No. 9330 of 2021
Decided On : 29-04-2022

Advocates appeared :
For the Appellant : Naman Nagrath, Sparsh Prasad
For the Respondent : Pushyamitra Bhargav

Headnote:(A) Mines and Minerals (Development and Regulation) Act, 1957 - Sections 15, 15-A, and 23-C - Amendment to Madhya Pradesh Minor Mineral Rules, 1996 imposes a regulatory fee for minerals transported from other states - Petition challenges the legality of this fee, asserting it exceeds state authority and violates inter-state commerce principles, citing State of Gujarat vs. Jayeshbhai Kanjibhai Kalathiya and another. (Paras 1, 3, 10, 35)

(B) Legislative Competence - Court examines the authority of the State Government to impose fees under the MMDR Act and determines it lacks competence to levy fees on minerals excavated legally from other states. (Paras 12, 30, 34)

(C) Quid Pro Quo - The regulatory fee lacks a correlation to services rendered, which is a necessary condition for validity. (Paras 36)

Facts of the case:
The petitioner, a cement manufacturer, is challenging a notification that requires a fee on minerals brought from other states after lawful excavation and payment of royalties. The petitioner claims the levy is arbitrary and infringes upon legal commerce.

Findings of Court:
The court ruled that the State Government overstepped its authority by imposing a regulatory fee under Rule 29(6) of the Madhya Pradesh Minor Mineral Rules, 1996. The regulation fee is deemed unconstitutional.

Issues: The main issues include the legality of the fee imposed by the State Government on minerals from other states and the scope of regulation permissible under the MMDR Act.

Ratio Decidendi: The court concluded that while the MMDR Act grants certain regulatory powers, they do not extend to imposing fees on lawfully sourced minerals from outside the state.

Result: Writ petition allowed; notification declaring the regulatory fee invalid is struck down and fees collected are to be refunded.

Table of Content
1. petitioner's challenge to regulation fees (Para 1 , 2)
2. state's authority to impose fees on minerals (Para 3 , 4)
3. state government's defense of the fee's legality (Para 6)
4. rejoinder: lack of competence to levy fees (Para 7 , 8 , 9)

ORDER VIVEK RUSIA, J. : – Shri Naman Nagrath, Senior Advocate along with Shri Sparsh Prasad, learned Counsel for the petitioner.

    Shri Pushyamitra Bhargav, Additional Advocate General for the respondents.

    The petitioner has filed the present petition challenging the validity of the Notification No. F-19-3-2017-XII-1 dated 22-1-2021 published by the State Government in the exercise of the powers conferred under section 15 and 15-A of the Mines and Minerals (Development and Regulation) Act, 1957 (hereinafter referred to as ‘MMDR Act, 1957’) whereby regulatory fee Rs. 25 per cubic meter has been imposed on minor minerals brought within State of Madhya Pradesh from other State.

    Petitioner’s case The Petitioner is a company incorporated under the provisions of the Companies Act, 1956 having its registered office at ‘B’ Wing, Ahura Centre, 2nd Floor, Mahakali Caves Road, Andheri (East), Mumbai-400 093. The petitioner is part of Aditya Birla Group and is one of the largest Cement manufacturing Companies in India having its manufacturing unit located at Khor, Tehsil- Jawad, District Neemuch, Madhya Pradesh (458470). For the production of cement, the petitioner requires a continuous supply of specific raw minerals viz. limestone, gypsum and additives like red ochre, laterite, bauxite etc. Some of the minerals reserves are already allotted to the petitioner by the State Government but some minerals which are not available in the State of Madhya Pradesh like Aluminum Oxide, Iron Oxide which are essential components of cement manufacturing, hence, the petitioner is importing these minor mineral from the neighbouring State of Rajasthan. According to the petitioner, the minor minerals legally excavated in the State of Rajasthan after payment of royalty amount to the State Government and complying with all statutory requirements, the suppliers dispatch to the petitioner by trucks/carriers.

2. The State of Madhya Pradesh has issued a Notification No. F-19-3-2017-XII-1 dated 22-1-2021 in the exercise of the powers conferred under section 15 and 15-A of the MMDR Act 1957 for amending Madhya Pradesh Mineral Rules, 1996 (hereinafter referred to as ‘ Rules, 1996’) by substituting sub-rule (6) of Rule 29 whereby a levy in the name of ‘Regulation Fee’ at the rate Rs. 25 per cubic meter has been imposed on minor minerals coming from other States into the State of Madhya Pradesh. In pursuant to the aforesaid notice, the District Mining Officer (in short’ D.M.O.’) has issued a press note dated 1-2-2021 directing business institutions and individuals to get themselves registered on the e-mineral portal to get transit pass. Respondent No. 4 vide notice dated 22-2-2021 has demanded the Regulation Fee at the rate of Rs. 25 per cubic meter on minor minerals coming from other States to the petitioner’s unit located at Neemuch. The petitioner has submitted a detailed reply dated 26-2-2021 objecting to such demand. The petitioner has also submitted an exhaustive representation to the Principal Secretary-Mining, State of Madhya Pradesh alleging the imposition of the regulation fee is an arbitrary Act of Government. Being aggrieved by the aforesaid impugned amendment, the petitioner has filed the present writ petition seeking issuance of a writ of certiorari, order/direction for quahsment of Rule 29 (6) so far as it relates to levy of regulation fee for issuance of a transit pass for mineral brought from outside the State of Madhya Pradesh through Notification No. F-19-3-2017-XII-1 dated 22-1-2021. Consequently, the petitioner is also seeking quashment of the demand notice dated 22-2-2021. Grounds of challenge in Writ Petition

3. The petitioner is assailing the aforesaid notification and demand inter alia on the

Click Here to Read the rest of this document
1
2
3
4
5
6
7
8
9
10
11
SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top